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Analysts at Rabobank have estimated the impact of COVID-19 on India’s economy though there is a downward risk that India might become the next virus hotspot. In this case, forecasts for the economy and INR will have to be downgraded. USD/INR is trading at 74.777.

Key quotes

“In our current baseline scenario, economic growth in India will go down sharply in 2020 to 3.6%. In this scenario, we assume that the virus will spread further and also affect India.

“We expect the INR to continue weakening on the back of ongoing dollar strengthen over the next three months to levels well above 75.” 

“The INR is expected to recover somewhat by the end of the year to levels of 73 and 74.”