Indian Rupee (INR) vs Pakistan Rupee (PKR)

Forget USD, you will be surprised to see that Indian Rupee has weakened by more than 15% against Pakistan rupee in past 3 months. Three months back an Indian Rupee could fetch 1.85 PKR (Pakistani Rupee) while now as on 28th Aug it's fetching just 1.54.

USD vs INR: Is this the top?

Ask any exporter, importer, analyst, currency expert or economics expert no one would have imagined 20% plus fall in Indian currency vs USD in matter of less than 4 months. INR depreciated from 53.80 levels on 1st May 2013 to 65.50 as on 22nd Aug 2013 a sharp fall of 21.7% in less than 4 months. 

Point taken that our currency is not alone in this fall and other emerging market currencies having high current account deficits fell sharply as well like Brazilian Real (BRL) is also down around 20% since 1st of May 2013 but the fall has been too much, particularly for INR, in very short span of time and the reversal is inevitable. Just consider the following facts:

1. Indian Economy is expected to grow by at least 5% in FY-14 and at least 6.0% in FY-15 vs U.S economy expected GDP growth rate of 2.6% in FY-14 and 2.8% in FY-15. In terms of growth rate difference India should continue to attract growth oriented capital from west from medium to long term perspective.

Emerging Market Currencies vs USD

The talks of United Stated Fed tapering has made emerging market currencies go into tailspin. Some countries such as India and Brazil has lost more than 15% of it's currency value against USD since 1st of May 2013 which has led to both equity and bond market selloff. Indian Rupee fell to all time low of Rs 64.50 against the greenback on 21st Aug 2013.

Rupee (INR) - Dollar (USD) Outlook: 2013

Exporters, Importers and FIIs would certainly not hesitate to pay even a billion dollar if anyone can tell them where Indian rupee would be against USD at the end of 2013. Putting a number to this equation is as difficult as it to guess if world would end in 2013 instead of 2012. Humor apart, instead of wasting energy in guessing a number if we can broadly estimate what could happen in next one year it will be equally helpful in taking informed decisions.

InvestorZclub feels that year 2013 is going to be bad for Indian Rupee in spite of nearly 20 percent depreciation against the US dollar in past 2 years. Just consider following points: