Rupee Slide Continues as Credit Rate Downgrades Loom

The rupee fell by almost 3% against the US dollar amid uncertainty over the Middle East and a gloomy forecast for economic growth this year.

Goldman Sachs cut its GDP growth forecast for India to 4% from 6%.

It also expects the rupee, Asia’s worst performing currency this year, to sink to 72 per dollar within six months.

Ratings agency Standard & Poor’s said that there was a more than one-in-three chance of a ratings downgrade for India within the next one to two years.

In the April-to-June quarter, India’s economy grew at a rate of 4.4%, compared with the same period in the previous year, the slowest quarterly expansion in four years.

August also saw India’s manufacturing sector shrink for the first time for four years.

via BBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza