SGD INR – Expected Trend till Mar 2013

Its hard to believe that we are already in February of 2013 and that calls for me to keep up on my promise and share with you my thoughts on SGD INR movements in the near term.

The trend so far has been inline with what I had expected in Dec 2012 – The pair has maintained the range of 42-46 with a downward bias (Read more: SGD-INR: How does 2013 look like?) and trades at 42.99 as I write.

SGD INR made multiple attempts to breach the 45 mark but have been unsuccessful. In the meantime a few interesting developments have happened on the fundamental front.

RBI came out and cut the rates by 25 basis points to stroke growth and the financial markets have taken a more “risk on” approach. The former would result in NRE deposit rates being lowered in the long term and the latter would attract FII in to the Indian Markets chasing growth.

At the same time the Indian Finance minister has promised financial reforms and started with reducing the fuel subsidies which helps reduce the Indian Budget deficit. This is also positive for the Rupee.

On the SGD front the currency has lost 2% against the USD and now trades at 1.24 as compared to 1.22 late last year.

These factors combined have seen SGD INR soften below 43 mark.

The question which people ask often is that how low will the pair fall and will SGD INR reach 45 again?

My view is that in the short term the pair would increase and move to cross the Rs.44 mark – The US debt ceiling discussions are due soon and so is Indian budget for 2013.

The uncertainty on the policy front would result in INR weakening against the USD which would mean a weaker INR against the SGD.

The recent spike in Crude Oil prices would add to woes for Indian Rupee.

So in-case the recent drop of SGD/INR has left you scrambling like Oct 2012 then don’t panic – next few weeks should give you an opportunity to see the pair touching 44 again.

 

Enjoy the Holidays and wishing you a very Happy Chinese New Year!! Gong Xi Fa Chai

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8 thoughts on “SGD INR – Expected Trend till Mar 2013”

  1. Thanks Aditya.. How abt the rate in coming next months (say next three months).. Will it decline or will be stable at this level..

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    1. I think it will decline a little. The currency could fluctuate between 42-44. Indian Rupee has been pretty stable.

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  2. Hi Aditya, I want to transfer 5K sgd to India. Pls suggest when it would be best in April 13 ? it is declined now..when it would regain ?

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    1. Hi Bhadresh,

      Depending upon what your purpose is to transfer funds to India the time horizon can be selected.
      If this money is for family maintenance you could transfer now. A rate of 43.5 is not a bad rate.
      If you are looking for investment this is a good time as well as you can lock in high fixed deposit rates.
      I see the rate being in 42 – 44 range

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  3. Hi, i need to transfer around 8k sgd to india. Is it advisable to transfer it now as the rate is 43.5 at the moment or can i expect increase in SGD in near future?

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