The Indian currency Rupee has been continuously wavering with lots of highs and lows in the last few months. But lately, Rupee is gaining the strength in emerging markets, and has been listed as one of the top 3 emerging market currency all over the world, thanks to the sliding price of crude oil.
Indian Rupee was about touch the peak of 75 against the dollar in last month, but due to the price drop in crude oil, and other factors, it closed at 71.46 on Tuesday, and there was no progress the next day, as the market was closed due to the Eid. Today, with the opening of the market, the currency opened with at 30 paise higher and made it to 71.16, the best for this week, giving a much-needed booster to the currency in Indian market – all thanks to the downfall in crude prices in international market.
According to the Bloomberg data, the Indian currency has gained around 2.79 percent against the dollar in past few weeks, making India third-best performer in the market. While the top two emerging market currencies are Chilean Peso on the first and the Indonesian Rupiah on the second, ahead of Indian Rupee in the list. Rupee’s performance in the emerging market currencies has made foreign investors to resume their purchases of the domestic assets as crude oil price faced 17 percent slump, and that is likely to boost up the corporate profits.
Gopikrishnan MS, head of foreign exchange, Standard Chartered, Mumbai said, “Falling crude prices make India assets attractive to overseas investors”. He expects that the currency can rise another 2-3 percent by the end of this year as he said, “The rupee now has ground to gain due to the expected fall in the trade deficit. The local unit can rise another 2-3 percent by this year-end”. Rupee will perform better and gain new strength in global market if crude price maintains the same level.