You might be an individual, an organization or the government, the impact of rupee fall had effected us all. As always everyone has someone or the other to blame regarding the losses in their portfolio. In recent few months, rupee has recorded some new falls. You can hear various reasons like inappropriate growth path, corrupted politicians, some recent scams, changing demands of the foreign market and an important fact, difference in the inflation rates. Whatever the reason may be, the result is that the investors have suffered a lot.
Impact Of Rupee Fall On Stock Market
Initially the stock market went into the losses with every new fall. But now it seems to be helpful and a good news for the investors is showing up these days. Going by the figures, it can be seen that in the market was fluctuating around 15,145 when the rupee-dollar exchange rate was 54 and with the fall upto 57 the market got improved to 17000. Though the rupee being cheaper is not good for the economy but it has been a point of attraction for foreign investors (FIIs). The market was able to show improvement because of the availability of foreign funds. And the further announcement of RBI to increase the existing limit in government securities (G-Secs) by USD 5 billion will help to overcome the situation. The step has been taken to curb the impact of Rupee fall (Rupee Depreciations).
So, the investors can expect that their portfolio will show the positive returns in near future. Just that they have to be a little smarter in their investments and portfolio designing. The growth of export oriented sector is expected to be better as compared to others. So, the sectors like IT, auto and pharmaceuticals sectors can help them in the investments. The reason simply being with the cheaper rupee, exports demand will increase and the companies will be able to register better profits.
Though with the decrease in the crude oil prices from 115-120 to the level of 90 was a positive sign for everybody but at the same time here also the same problem exists. The depreciating rupee simultaneously had almost neutralized the effect. So, we can see that the overall impact of rupee fall has shown the negative impact on the investors portfolio. Now, the investors have to move towards the export based companies for better results.