* * * TIME to Trasfer Currency : Save UR savings

1

1amShantanuB

Banned
Keeping the present "developments" into view I think it is better to have our savings ( at least a part ) into Indian rupees.

So go ahead guys .. save your savings
before it sees a loer exchange rates.

we have been in unfortunate batch ( prolonged adjudications)
Lets not sit again in similar BOAT of exchange rates.

Exchage rates are going down...........
 
Yes it may rupee may breach the psychological barrier of 46.00.It would have today had if RBI has not intervened with very heavy purchases.

By year end it may hover in 40 - 43 range.
 
It is not my "wild guess". Forex experts opinion.

Increasing foreign reserves, BPO outsourcing, political stability for the past 4 years, good interest rates in India as compared to US,Europe, improving business sentiment, more privatisation, increasing exports, weak dollar etc are some of the reasons cited for the rupee appreciation.
 
The exchange rate in India is not set truly by the market. RBI can intervene and influence the rate. 1amShantanuB, it is true that the exchange rate has gone down from 48/49 to 46.

There is a problem with strong Rupee (meaning high value of rupee against dollar), the exports from India especially to the US become expensive and the US will no longer import the same amount from India. This might hurt the Indian exports. On the contrary the imports (only from the US) become cheap. So if we have a deficit in the trade with the US, a strong rupee might help. A strong rupee might encourage a lot of foreign investment and the value of our foreign reserves might increase.

Countries like China, which run trade surpluses with the US want a weaker Chinese currency so that their exports are still cheap in the US.
 
Originally posted by frantic
The exchange rate in India is not set truly by the market. RBI can intervene and influence the rate. 1amShantanuB, it is true that the exchange rate has gone down from 48/49 to 46.

There is a problem with strong Rupee (meaning high value of rupee against dollar), the exports from India especially to the US become expensive and the US will no longer import the same amount from India. This might hurt the Indian exports. On the contrary the imports (only from the US) become cheap. So if we have a deficit in the trade with the US, a strong rupee might help. A strong rupee might encourage a lot of foreign investment and the value of our foreign reserves might increase.

Countries like China, which run trade surpluses with the US want a weaker Chinese currency so that their exports are still cheap in the US.
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We do not have full convertiblity.I agree but there is a limit to RBI intervention.By purchasing more dollars in the market and it stops rupee appreciation temporarly.
But it leads to excessive liquidity in the economy which inturn leads to inflation.RBI has earlier tried to prevent rupee appreciation from 49 to 47-48 and then gave up. It is once again back to prevent crossing 46.

A weak rupee helps exports(but also makes our imports costlier) but increasing foreign reserves make RBI choices limited.
 
Can you refer me an article that discusses about all this stuff. I am not questioning your trustworthiness, but I need to make myself sure before I do anything.
Thanks to 1am for bringing a good topic . . .
 
Originally posted by gcgcgcgc
Can you refer me an article that discusses about all this stuff. I am not questioning your trustworthiness, but I need to make myself sure before I do anything.
Thanks to 1am for bringing a good topic . . .
Click to expand...

search BBC, I remember reading one there
 
Rupee, in reality, if stengthening and appreciating against the US Dollar, should also appreciate against other currencies like Euro, UK pound sterling, etc. But, this is not the case. It is losing against these currencies but gaining against US dollar. Anyway, forex dealings have risks and blindly moving money to Rupee etc. will result in losses.

BTW, conversion now is a bit late. Any conversion should have been against Euro a year ago.

Some risk mitigating or rather currency hedging investments could be ICICI's foreign currency plan or twin currency plan. If one understands foreign currency investments, one could also invest in foreign currency CDs at http://www.everbank.com and check under "Currencies." One could also have NRE FD accounts which are repatriable now. One could have most of these in Euro or UK pounds too instead of Rupee.

Disclaimer: I am not associated with these firms and these investments carry risks and are susceptible to exchange rate fluctuations. Do your due diligence before deciding on investing in these. Also, remember money in Indian banks are insured upto Rs. 100,000 (1 lakh).
 
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The recent appreciation of Rupee has been mainly because of the foreign direct investment. The US (developed world) is in a recession and the returns on the stock market have been negative, whereas the returns on Indian stock market have not been that bad. This increased the inflow of money from the Foreign Institutional Investors appreciating the Rupee.

GCSeekerInd, you are right in saying that the RBI can intervene only to a certain extent by asking the SBI to purchase more foreign currency. But this appreciation has been mainly based on the fact that the US stock market has not been doing quite well. But we are seeing an improvement in the stock market recently. So it is anyone's guess if the rupee is going to appreciate or depreciate.
 
st8, it has been the current administration's policy not to intervene regarding the strength of the dollar, where as the Clinton administration went for a strong dollar policy. Since the US stock market had three years of declines, foreign investment in the stock market has been reducing resulting in the weakness of the dollar.

The weak dollar has helped the US trade by making the US exports cheap increasing the US exports. On the contrary the Euro has appreciated against the dollar making the European exports expensive. So in effect the US to an extent transferred the recession to Europe.
 
I beg to differ....

Originally posted by st8
Rupee, in reality, if stengthening and appreciating against the US Dollar, should also appreciate against other currencies like Euro, UK pound sterling, etc. But, this is not the case. It is losing against these currencies but gaining against US dollar. Anyway, forex dealings have risks and blindly moving money to Rupee etc. will result in losses.

BTW, conversion now is a bit late. Any conversion should have been against Euro a year ago.

Some risk mitigating or rather currency hedging investments could be ICICI's foreign currency plan or twin currency plan. If one understands foreign currency investments, one could also invest in foreign currency CDs at http://www.everbank.com and check under "Currencies." One could also have NRE FD accounts which are repatriable now. One could have most of these in Euro or UK pounds too instead of Rupee.

Disclaimer: I am not associated with these firms and these investments carry risks and are susceptible to exchange rate fluctuations. Do your due diligence before deciding on investing in these. Also, remember money in Indian banks are insured upto Rs. 100,000 (1 lakh).
Click to expand...

Your claim that Rupee is not doing well with any other currency other Dollar is not a true statement.. Euro and GBP has lost greater share compared to dollar over the last week.....

Take a quick peek at RBI's web site....Just in one day Euro has gone down by 38 Paise......



http://www.rbi.org.in/
 
chakmur, you should not look at one day's data and come to conclusions. In the link you gave, if you click on the 'Reference Rate Archive', you would see that the Rupee has depreciated against the Euro going back to 2002.
 
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chakmur,
I do not know what to say. How can you look at a day's data and make a judgement.

Compare the last 2 years (the period of rupee strength) Rupee performance vis-a-vis US Dollar, Euro and UK pound sterling.

Since Re gained 38 paise in a day, would you move money to Rupees and tomorrow it lost 38 paise would you move make back your money?

:rolleyes:
 
It's not just one day...

Look at the trend..... I agree Q1 2003 and Early Q2 2003 was very good for Euro.. But From May 2003 there is no looking back for the Indian Rupee .. It has gone stronger day by day.... From 55 Rupees, Euro has slid to 51.. roughly 9 % . War has definitely contributed a great deal to that .. Al Walid Bin Talal & co of Saudi pulled billions of dollars out of US and invested in Europe in early 2003 in expectations of war and and so there was a real bullish market in Europe.. Ever since market started showing recovery here the Euro has kept steady with USD.... so Rupee has shown similar trends against USD and Euro....
 
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