India's Rupee Faces Depreciation Despite U.S.-India Trade Agreement

Despite the optimism surrounding the recent trade agreement between the United States and India, analysts predict that the Indian rupee may continue to depreciate over the next year. According to Jin10, the pressure from foreign capital outflows and India's current account deficit are contributing factors to this anticipated decline. Dhiraj Nim, an economist and foreign exchange strategist at ANZ Bank, noted that the U.S.-India trade deal has eliminated India's relative disadvantage in accessing the U.S. market compared to other Southeast Asian countries. However, several economists forecast that the rupee-to-dollar exchange rate could fall to approximately 94 within this year.