The rally that boosted the currency to the strongest in 32 months will probably be short-lived. The rupee is facing headwinds as elevated energy prices threaten to increase inflation and worsen public finances in a nation that imports most of its oil needs. The rupee advanced to 63.3725 on 8 January, the strongest since April 2015 and closed at 63.6287 last week. Target exceededA surge in oil prices to a three-year high and slowing economic growth has clouded the picture. Elevated commodity prices “are not playing in the rupee’s favor,” said Anindya Banerjee, an analyst at the company in Mumbai.

Source: Mint January 15, 2018 03:11 UTC