Will The Rising Rupee Hurt Exports?

Fresh appreciation can hurt

S A BHATT

GM, International and Treasury,

Bank of India

The foreign exchange market is witnessing a secular upward movement of rupee for the past year-and-a-half.

The rupee, which was at 48.80 a dollar on March 31, 2002, has strengthened to 47.48 in March this year and is currently at 46.12.

The main reason for this is the larger and steady inflows, particularly from foreign institutional investors (FIIs), lesser demand from importers and panic selling by the exporters.

Despite the strengthening rupee, country