RUPEE OUTLOOK

RBI took measures to curb the speculation in Indian Rupee 1) First, it curbed trading in rupee forwards. Once cancelled, forward contracts could not be bought again, The new rule applies to domestic as well as foreign investors and takes effect immediately. (Forwards are agreements to buy or sell assets at a set price and date.) Forward contracts booked by foreign institutional investors, once cancelled, could not be rebooked. 2) RBI reduced the open positions dealers can maintain overnight. The impact of lowering the trading limits would be huge because banks would not be able to keep speculative positions open for a long time. The broad message the RBI is trying to give is that speculative tendencies have to be curbed and genuine demand and supply should be allowed to move the currency rate. My Advise: Rupee will not fall below 49.50..with this news you can expect it will come down maximum to 51.15…if 51.15 breaks then you can see falling to 50.50..but I personally feel it should not fall below 49.50……(58 to 60 is my ultimate target) (Please Note: The content of this report are based on my personal view)