Indian Rupee in the new year: Mecklai chart

Mecklai graph of the day: Rupee in the new year

As the FY 12-13 draws to a close and the banks and the corporates adjust their year end positions, the rupee has more or less been restricted to a tight range. In the recent past, rupee has been through roller coaster of a ride, depreciating on the heels of weaker fundamentals, anaemic growth, political uncertainty, global weakness and twin deficits. To counter the same, corrective action by the government in the form of bold steps taken to boost foreign inflows has been well complimented by RBI, cushioning rupee to a great extent. Against this backdrop, the below graph serves as a precursor to the movement in rupee at the beginning of next fiscal year.

As seen in the graph, the rupee has appreciated, four times in the last eight years, at the beginning of every financial year since 2005, while posting a small amount of depreciation at other times. We have witnessed an appreciation of almost a rupee in 2009, strengthening the case for rupee to perform better during the said period in April. We would wait and watch to see if rupee rides on the foreign inflows to register another week of appreciation in the next week.

The below graph depicts the movement in the USDINR pair in first week of April since 2005

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

Read More