A surging US dollar to hit Indian rupee

Mumbai: The rupee is likely to edge lower against the US dollar as traders are likely to buy the latter after a clear mandate in the US presidential election eliminated political and fiscal uncertainty in that country. Last week’s volatile trade will give way to a more orderly market as traders will go back to the currency’s fundamental and price in expectations with the new US government.

“I expect the dollar to gain in the short term because of the stability that Biden brings and also as markets are expecting him to step up spending,” said Ashish Vaidya, head — treasury at DBS Bank. “However, weakness in the rupee is not expected to be too much because the RBI will ensure that any large fall in the currency will be cushioned with its record forex reserves.”