The dollar has risen from 43.5 to 47 in the last 2 months....if the trend continues, this will make the Indian Real Estate cheaper to the NRI with Dollar denominated earnings...:bab (59):

Will it lead to rise in the prices of places especially like GGN, which has been the darling of NRI investors for long....:bab (38):
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  • NRI money

    Amit-sir ......aapke kathan main kaafi wajan hai.

    Surprisingly & very unexpectedly Dollar is appreciating & is touching 47.2 as of this moment. If this continues for few more days, expect big inflow of NRI savings into India which eventually will rest in RE.

    How long this continue is the point to be debated because situation in US is not good & this increase is moreso coming from bad-economy & mood back-home only.



    Originally Posted by amit001
    The dollar has risen from 43.5 to 47 in the last 2 months....if the trend continues, this will make the Indian Real Estate cheaper to the NRI with Dollar denominated earnings...:bab (59):

    Will it lead to rise in the prices of places especially like GGN, which has been the darling of NRI investors for long....:bab (38):
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  • Originally Posted by amit001
    The dollar has risen from 43.5 to 47 in the last 2 months....if the trend continues, this will make the Indian Real Estate cheaper to the NRI with Dollar denominated earnings...:bab (59):

    Will it lead to rise in the prices of places especially like GGN, which has been the darling of NRI investors for long....:bab (38):


    Businesses in the US and Europe have been hit very hard by slowing economy once again in last few months. It is hard to believe that NRIs have remained isolated from the troubles of the countries where they are living.

    Due to Visa issues, IT companies are not sending as many workers overseas now a days as they used to do 4-5 years ago. So even the IT guys with temporary dollar denominated income streams are less in numbers now a days.
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  • Punjabi - you are right...

    Thats a caveat I forgot to put that the rise in dollar will help the NRI, provided their jobs are doing all right...
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  • Sliding Re to boost export earnings

    BANGALORE: Indian exporters are expected to benefit this quarter thanks to the rupee's slide against the dollar. The rupee hit a 14-month low in afternoon trade on Monday, breaching the Rs 47 level.

    Ganesh Murthy, CFO at IT company Mphasis, said that from an average rate of Rs 44.63 to the dollar in the previous quarter, the average rate for this quarter so far is Rs 46.25.

    The rupee has been sliding since the US downgrade by S&P, and if current conditions persist there could be a 2 percentage points beneficial impact on revenue growth. Despite the US downgrade, fears of a double-dip recession have meant that flows into the dollar has picked up as US treasuries are perceived as a safe haven in troubled times.

    A large portion of the IT sector revenues comes from the US (around 70%) and European geographies. It invoices a significant portion of its bills in dollars. Therefore, a depreciation of the rupee against the dollar would translate into higher rupee earnings.

    Even garment exporters are forecasting better returns. "The fall of the rupee against the dollar is beneficial. We can take advantage of this by going in for forward booking of contracts," said A Saktivel, president of Tirupur Exporters Association. He added that usually exporters book a third by way of forward and a third by way of spot. Even as business continues to be at low ebb, Saktivel, expects better fortunes from next month, as orders for summer 2012 will start coming in then.

    Ankur Rudra, IT sector analyst at Ambit Capital, said that that the rupee has in recent times also depreciated against prominent currencies like the British Sterling and Australian dollar. This too will help the rupee income from IT exports.

    But the Euro has weakened against the rupee and this could have a downward impact on rupee revenues.

    Anil Chanana, CFO, HCL Technologies, said that the continued depreciation of the rupee would definitely have a positive impact on operating margins of the IT industry. The high volatility of the rupee over the past several years has pushed most big exporters to hedge. Chanana said HCL hedges between 20% and 40% of inflows. Mphasis is hedged at Rs 47.15 to the dollar and if the rupee goes below that level, it might have a small impact on the company's earnings.

    However industry analysts do not expect a further drastic slide in the rupee as RBI is expected to step in to protect the interests of importers. Also, given that the depreciation is happening on the back of falling demand in major global economies, it is not yet clear how exporters' overall revenues will be this quarter.

    In the previous quarter rupee appreciation adversely impacted earnings of IT companies. According to an Angel Broking report in July, in the previous quarter revenues for IT bellwether Infosys in rupee terms came in at Rs 7,485 crore, a 3.2% sequential growth. This rate was lower than the 4.3% dollar revenue growth due to a rupee appreciation of 1% over the previous quarter.

    The company's operating margin was also negatively impacted by 40 basis points sequentially due to the rupee appreciation.
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  • Exporters see the fall in rupee's exchange value against dollar as a boon for them but are also worried about sharp fluctuations in the local currency's trade against the US unit.
    Traders who got their exports realisation today turned out to be more lucky as the domestic currency tumbled by 66 paise to close at nearly a 14-month low of 47.22/23 against the US currency, meaning they earn more money. The rupee had closed at Rs 46.56 in its previous trade.
    "A weak rupee is good for exporters, but it is too difficult to predict a trend when there is so much fluctuation in the currency market," Ajay Sahai, Director General, Federation of Indian Exporters Organisation said.
    He, however added that sharp fluctuations in rupee-dollar mostly help speculators.
    The falling of rupee is seen as "good news" when there is a demand slowdown in the US and Europe -- the traditional export markets of India.
    Foreign exchange dealers said persisting demand for dollar from importers and banks in the wake of fresh signs of capital outflows weighed against the local currency.
    "The rupee will continue to be vulnerable in short-term and it is very difficult to predict its movement. It may also go to 47.50 to 47.75 levels. In the medium-term, we expect it to play out well and factors like the ONGC FPO and FDI coming to India should help it go below 46 by 2011-end," Ananth Narayan, MD & Regional Head, Fixed Income, Currencies and Commodities, said.
    Helped by an impressive 81.79% jump in exports in July, the outbound shipments during the first four months of the fiscal grew by 53.98% to USD 108.34 billion year-on-year.
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  • Euro zone woes pull rupee down to 14-month low

    MUMBAI: The rupee has touched a 14-month low of 47.05 per dollar as the Euro zone problems escalated with Germany and France unwilling to bail out the troubled partners. This is likely to further widen the trade deficit on account of the rising oil import bill.

    "In the short term, volatility is likely to continue as issues in the Euro zone remain a problem. The ensuing trouble there could trigger a global risk off, which might further impact our outflows and also strengthen the dollar. We also need to keep an eye on oil prices," said Ananth Narayan, head of treasury operations, Standard Chartered bank.

    The rupee, which opened on Monday at 46.93 per dollar, closed 57 paise weaker at 47.21 per dollar. "The markets have reacted to the weakness in the euro, that has impacted FII inflows, which led to a short squeeze in dollars in the market," said RN Hirve, chief dealer at Central Bank of India. FIIs pulled out $1.76 billion in August, which is reckoned to be the highest pullout in a month since 2008.

    The rupee has weakened 6.7% since August 1, after concerns over the global economic outlook deepened following the downgrade of US sovereign debt. It is expected to touch 47.50-47.75 per dollar this month. In the medium and long-term though, owing to large interest rate differential, the rupee could recover again to levels below 46 per dollar.

    "The current depression of rupee is more on account of widening trade deficit, and its slowdown may not lead to increase in our exports. However, our imports will be impacted negatively as the depreciating rupee will counter the advantage of declining global commodity prices," said Madan Sabnavis, chief economist at Care rating agency.

    Prices of non-fuel products like metals, chemicals and fuel-based products, which are not administered could be impacted by a weakening rupee. "But over all, the net impact on inflation will be marginal," said Sabnavis. Going forward, however, ONGC's follow-on public offer could bring in dollar inflows, which might provide some relief to the weakening rupee, according to currency dealers.
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  • Euro zone woes pull rupee down to 14-month low

    MUMBAI: The rupee has touched a 14-month low of 47.05 per dollar as the Euro zone problems escalated with Germany and France unwilling to bail out the troubled partners. This is likely to further widen the trade deficit on account of the rising oil import bill.

    "In the short term, volatility is likely to continue as issues in the Euro zone remain a problem. The ensuing trouble there could trigger a global risk off, which might further impact our outflows and also strengthen the dollar. We also need to keep an eye on oil prices," said Ananth Narayan, head of treasury operations, Standard Chartered bank.

    The rupee, which opened on Monday at 46.93 per dollar, closed 57 paise weaker at 47.21 per dollar. "The markets have reacted to the weakness in the euro, that has impacted FII inflows, which led to a short squeeze in dollars in the market," said RN Hirve, chief dealer at Central Bank of India. FIIs pulled out $1.76 billion in August, which is reckoned to be the highest pullout in a month since 2008.

    The rupee has weakened 6.7% since August 1, after concerns over the global economic outlook deepened following the downgrade of US sovereign debt. It is expected to touch 47.50-47.75 per dollar this month. In the medium and long-term though, owing to large interest rate differential, the rupee could recover again to levels below 46 per dollar.

    "The current depression of rupee is more on account of widening trade deficit, and its slowdown may not lead to increase in our exports. However, our imports will be impacted negatively as the depreciating rupee will counter the advantage of declining global commodity prices," said Madan Sabnavis, chief economist at Care rating agency.

    Prices of non-fuel products like metals, chemicals and fuel-based products, which are not administered could be impacted by a weakening rupee. "But over all, the net impact on inflation will be marginal," said Sabnavis. Going forward, however, ONGC's follow-on public offer could bring in dollar inflows, which might provide some relief to the weakening rupee, according to currency dealers.
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  • Rupee remittances may jump if rupee continues to depreciate

    Abu Dhabi: The flow of money transfers from the UAE to India is set to increase at a fast clip following the Indian rupee's continued depreciation against the dollar and the dirham, which is pegged to the dollar, say experts.
    Monday, Dh1 was fetching Rs12.84 in the currency market, a level not seen in more than a year.
    A dollar is worth Dh3.678. If the global financial scene deteriorates further, the dirham may soon fetch Rs13 or more.
    "A reduction in dollar inflows and an increase in dollar outflows lead to the rupee's depreciation. If the negative news from the international markets, particularly from Europe continues, it may lead to a situation where foreign funds sell more stocks in India, exporters stop selling dollars and importers buy even more dollars, leading to even higher dollar demand," Ashok Gupta, chief executive for Bank of Baroda's GCC operations, told Gulf News.
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    Rupee-dollar rate
    "In the near-term, the rupee may touch 48 to the dollar," he added.
    Sudhir Shetty, chief operating officer for UAE Exchange, said the rupee may soon test 47.50 to the dollar.
    "The dollar index is rising, the importers are going for cover, the foreign institutional investors are taking their money out of the stock market and the Reserve Bank of India has stayed away from managing the slide in the rupee," he said.
    "If the 47.5 level is breached, the rupee may go towards 49 to the dollar.
    "However, I expect the Reserve Bank of India to intervene in the currency market soon after the rupee goes past 47.5 to the dollar," said Shetty.
    He said in the course of the last three trading days the rupee has plummeted against the dirham, which has led to an upsurge in currency remittances from the UAE to India.
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