The US dollar was trading at Rs139 in the open market on Thursday morning, an indication of stability in the exchange rates.
The dollar has been hovering at this level for two weeks now, but it had kept buyers and sellers on their toes last year because of volatility in its prices and hit its all-time high of Rs140.3 in November.
Last year, the dollar’s rate appreciated 27% against the rupee, witnessing two of its biggest ever single day jumps in the short span of one-and-a-half months. The dollar rose against all major currencies pegged against it, but on Monday it fell slightly after investors put to rest the expectations of a further rise in the interest rate of American central bank, which could make the dollar stronger.
According to a report released by Moody’s, our dollar reserves will remain under pressure this year as well because our external financial needs (imports and loan payments) are far greater than the dollars parked in the central bank’s coffers. This means the rupee will also remain under pressure and may fall further. However, if we are able to increase our reserves by securing more loans, the dollar may continue to be stable.