The Indian rupee managed to gain today even amid the market sentiment that was negative to risky assets. The rally was caused by hopes that falling prices on raw materials will help to reduce the nation’s current-account deficit.
Finance Minister Palaniappan Chidambaram said that the current-account gap was 5 percent of gross domestic product in the fiscal year ended March 31. Gold, which has fallen 14 percent this month, makes up two-third of the shortfall according to the Reserve Bank of India. Brent crude oil, 80 percent of which India imports, has dropped 11 percent.
USD/INR went down from 54.1805 to 53.9955 as of 9:12 GMT today.
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