Last week’s Dollar selloff pushed USD/INR below 82.00. Economists at Credit Suisse now widen their USD/INR range to 81.00-84.0 and highlight the risk of RBI intervention near 81.00.

USD/INR target widened to 81.00-84.00 

“Although we still think the Rupee will weaken vs USD over the long term, in the short term REER stability means that USD/INR will reflect broad USD weakness, as the RBI occasionally shifts its intervention corridor accordingly.”

“Now that the 82.00 level has broken, we expect more rigorous intervention by the central bank near 81.00.” 

“Although further USD weakness means the RBI could shift its intervention corridor yet again, recent history suggests that 81.00 is a firmer ‘red line.’ As such, we widen our Q1 USD/INR forecast range to 81.00-84.00.”