Can rupee touch 65 to a dollar ?

The rupee crossed 61 to a dollar again as discussed in our USD INR Forecast. This should not be surprising given that the demand for dollars is much more than their supply.
So now question lies Can Rupee touch 65 in medium term. Let me answer the question for you talking on both Fundamental and Technical of INR.
The trade deficit for the month of April 2013 had stood at $17.8 billion. If we add this to the trade deficit of $20.1 billion for the month of May 2013, we get a trade deficit of nearly $38 billion for the first two months of the year.  With the way things currently are it is safe to say that the trade deficit for 2013-2014(or the period between April 1, 2013 and March 31, 2014) is likely to be similar to that of last year, if not higher.Also the way crude is rising its likely to put more pressure on Fiscal deficit.Indian Government has foreign debt of $172 billion that needs to be repaid during 2013-2014. Also FII which are on selling spree are likely to pull out more money for Equity and Debt market.The foreign investors pulled out investments worth more than Rs 44,000 crore or around $7.53 billion, from the Indian bond and stock markets during the month of June, 2013.
Things are not looking ..

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