Ashu Dutt's The Currency Trader - December 2010 Edition - See http://www.ashudutt.com/currencytrader.aspx

It has permanently lost its place as the “safe haven currency”. And that means that we need to get used to a new rate for the rupee (and other Asian currencies). I would expect the rupee to be heading to Rs 30 to a US$ in the next 3 years. In the immediate term, the rupee will appreciate about 10% and get to Rs 40 anytime in the next 12 months. If the RBI tries to stop the appreciation of the rupee, the only way it can do that is by buying dollars and selling rupees. That would mean too many rupees chasing low quality assets in an already bubbly stock, real estate and commodity markets. I don’t believe the RBI will go that way. Its way too important for the RBI to keep inflationary pressures low than worry about an appreciating rupee
Ashu Dutt's The Currency Trader - December 2010 Edition - See http://www.ashudutt.com/currencytrader.aspx
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