Rupee may recover to 69.79 a dollar if RBI mops up $30 bn from NRIs: Report

The rupee may average at 69.79 to the dollar in the second half, down 8.3 per cent from the first half, if the monetary authority props it up by mobilising at least $30 billion from NRIs as it has done in 2013. The rupee is the worst-performing emerging market currency losing over 15 per cent year-to-date, while in the first half it averaged at 68.57 to the dollar, down 8.3 per cent year-on-year, making the depreciation at a five-year high so far, says an India Ratings report. Following the market mayhem and the rupee plunge after the Fed ‘taper tantrum’ in summer of 2013, RBI mobilised $25 billion from non-resident Indians The move was initiated by the then governor Raghuram Rajan soon after he took over the RBI reins in September that year. While the first line of rupee defence has traditionally been invisibles, remittances and software earnings, this time around these could not grow at the same pace as merchandise imports. This widened the current account deficit and put the rupee under pressure.

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