BY SACHIN KUMAR
DOHA: For the first time in 14 months, the Indian rupee has breached the psychological barrier of 17 against the Qatari riyal (QR), bringing cheers to Indian expatriates.
The rupee last traded at 17 against the riyal in August 2013. The Indian currency has fallen seven percent since April this year, when it had appreciated to 15.96 against the riyal.
In the local foreign exchange market the rupee plunged last Friday to 17.08 against the dollar-pegged riyal before closing at 16.98, leading to a rush among Indian expatriates to send money home.
“The depreciation of the rupee has brought smiles to the faces of Indian expatriates. There is a mixed response from customers, with some Indians rushing to send money while others are holding back in anticipation of a further decline,” said Zuber Abdul Rahman, Operations Manager, Al Zaman Exchange.
“The Indian rupee is expected to decline further in coming months. With oil prices and gold rates heading down, the US dollar has become the favourite asset for global investors,” added Rahman.
The rupee is following other major global currencies, which have seen a gradual decline against the US dollar. Buoyed by signs of recovery in the US economy, the Federal Reserve has decided to stop its bond buying programme known as Quantitative Easing. Interest rates in the world’s largest economy are expected to rise in coming months, leading to strengthening of the dollar as global investors chase the greenback. The recent fall in gold and crude oil prices have also supported the fall of the rupee and other major currencies against the US dollar.
“We expect the rupee to trade in the range 17.50-18 against the Qatari riyal in next few months,” said a senior official working in a currency exchange.
“The recovery in the US economy will further strengthen the dollar against major global currencies,” he added.
The rupee has fallen more than 40 percent in the past four years. It was quoting at 12.05 against the Qatari riyal in mid-September 2010, and plunged to 17.30 in late August 2013. It touched an all-time low of 18.80 in September last year.
Exchange house in Qatar are expecting huge remittances by Indian expatriates. “Many Indian expatriates had even taken personal loans from banks and sent money to their families to leverage the decline of the rupee,” said a senior official of currency exchange.
THE PENINSULA
