Reason for Rupee Depreciation

As discussed in Morning post Rupee is trading near 8.5 month low,it has plunged almost 3% for the week. FII have been pumping money in India from the start of 2013 and for May alone we have seen flows of  $3 Billion mainly in Equities and Debt market. Also with $5.9 Billion Dollar Open offer by Hindustan Unilever in line, With such huge FII money flow Rupee is still trading at 56.25 which is kind of riddle for many people. Let me elaborate why Rupee is still trading at 8.5 month low.

Dollar trading at 3 year High

As discussed US Dollar at 3-Year High   USD has touched its 3 year High at 84.3, US stock market are at life highs,Strength in USD indicated recovery in US economy, We have seen a slew of data indicating the same. Housing Market is recovering, Job situation is improving which make market participants believe the US Fed will be tapering of QE Infinity. Gold which was safe heaven for investor has been quiet volatile off late, So investor looking for stable and non volatile instruments has

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