Rupee Set for Stabilization Amid Forex Volatility

The Indian Rupee is anticipated to stabilize around 85-86 against the US dollar in the coming weeks as the RBI focuses on currency stability. Recent depreciation has caused concerns, but RBI interventions aim to mitigate further falls. A potential rise in import tariffs is also considered to curb the decline.

The Indian Rupee is poised for stabilization, expected to hold at 85-86 against the US dollar in the weeks ahead, as the Reserve Bank of India maintains its focus on currency stability, according to Deloitte economist Rumki Majumdar.

The Rupee, which recently hit a historic low of 86.70 per dollar, faces challenges from foreign fund outflows and declining domestic equity markets. Despite the depreciation, Majumdar affirms that interventions by the RBI are aimed at mitigating further falls.

To curb the declining value, the government may raise import tariffs, says EY Chief Policy Advisor DK Srivastava. The intention is to reduce dollar demand from importers, easing pressure on the rupee as financial resources flock to the recovering US economy.

(With inputs from agencies.)