Rupee effect: Forex biz hit as Indians cancel foreign trips

New Delhi: Even as foreign investors and travelers hit the panic button over the sliding rupee, which hit a record low last Friday closing at 57.32 to a dollar, currency exchangers are no different.

Firstpost spoke to a few of them in New Delhi and they said the fall in business has been directly proportional to the depreciation of the rupee -with customer turnaround dropping by more than 50 percent for a few.

“We are having just 50-60 percent of customers buying dollars from us compared to last year,” says Sanjay Bhutani, proprietor of Bharat Dry Fruit Mart.

Whle Bhutani said much of his forex business has been hit by travellers canceling their foreign trips due to the rising dollar, others like Jitender Singh said the hoarding of dollars by traders and well travelled people are affecting his business. Singh is the manager at Handpaper World.

“Many traders and others are anticipating a further increase in the dollar rate and thinking that it will cross Rs 58. So many are holding onto their dollars thinking they will exchange it then,” says Jitender Singh.

However, Singh is anticipating an increase in his business and profits once the rupee hits 58 to a dollar. He says those holding onto dollars will then let loose and sell them.

“We are hoping that when the dollar does rise the number of customers we have will also increase,” says Singh.

But, Bhutani is skeptical. He says the profits they make will only be on paper and not actual.

“While we may have bought the dollars at a lower price because of low demand the currency we bought is blocked with us, so the profit that we are making is only on paper and does not translate into actuals,” says Bhutani.

While, the rupee has consecutively slid since mid 2011, in this year alone, it has fallen about 7 percent, making it the worst performing currency monitored daily in Asia by Reuters.