According to Bloomberg press, Westpac Banking Corporation is expecting the Indian Rupee to strength this year by 1%. A currency strategist at the company says that the Rupee will be especially strong against the United States dollar because of the severe recession in America, which is expected to lower confidence in the USD.
Westpac is bullish on the Indian Rupee because of India’s strong domestic demand for goods and its small reliance on international exports. The Rupee has already gained .4% value this year. The Indian economy is still growing at a healthy rate of 7.1%, but it is low compared to recent trends. In the three years before March 2008, the growth rate was an astounding 9.3%. In response to the reduction in growth, the Reserve Bank of India is expected to lower rates in order to encourage lending.
India Info