Posted Jun 27, 2013 by Martin Armstrong
The Rupee has fallen sharply against the US dollar as volatility rises. The current account deficit jumped largely because India’s gold purchases rose from 90 tons to 300 tons as the price collapsed. But this led to India imposing more tariffs on the importation of gold stopping the buying and contributing to the collapse in gold prices. The goldbugs still are yelling about manipulations and paper gold sales, but the largest cash buying is having a massive impact upon the currency. It does not matter that they are buying an asset that can be resold compared to importing consumer goods. The rupee is decline as part of the dollar bull market.
The US dollar is in a bull market that may last until October 2015.The max target would be 68.5 rupee up from the current level of about 59. Short-term, we are lining up with the ECM target for the week of 8/05.