Which way Rupee will go?

It would be difficult to predict where the rupee will head against the dollar in 2012. Will it revert back to reasonable levels of Rs 45/US$? It all depends on how the growth of the Indian economy pans out and what the government does to keep its finances in check. This means that the policy paralysis at the Centre will have to end and the government will gave to focus on reforms to instill confidence once again in investors. More importantly, efforts have to be made to reduce deficit. Indeed, a rising deficit only strengthens the case for a weaker rupee.