Rupee this year has lost a great deal due to number of reasons primarily being the crude oil price rise that exceeded in price to as high as 77 per barrel and now given the concerns around economic slowdown and production over-supply has again declined substantially. Rupee touched a low of 74. 48 in early October.
The prime impact over rupee's movement due to crude oil price is due to the commodity being the largest import item for India and in its wake the fiscal maths of the country gets affected adversely and thus there is a threat to inflation as well. As crude oil price jump caused prices to jump across industries from auto fuel to FMCG goods etc.
Nonetheless, now that the signs of any reversal in crude oil prices have receded, rupee is likely to grain ground and the resilience is visible in the sharp jump of the domestic currency from 74 to 72 in just one month's time given the confidence exuded by the foreign fund flow as well due to a better economic environment now posed by India.
Further, as of now as the dollar is losing its gaining streak in view of the US-China tension and interest rate outlook there, rupee's strength is more to gain ground from here on if the momentum continues.
Also, considering the historical trend in the movement of rupee, it is perceived that rupee will test levels of between 68 and 69 in the coming months. But there can be seen some resistance as well and rupee may again lose ground.