Reuters Market EYe - Credit Agricole raises its forecast for the rupee to 55.30 for September from 56.00; maintains year-end target at 52.00.
Further gains in the Indian rupee to be gradual, but prospects of a further sharp decline in the currency have lessened, Credit Agricole says in a note dated Tuesday.
The bank says the prospects for the rupee has been supported by the recent depreciation of the currency in REER terms, which has allowed India to regain export competitiveness.
The rupee is unlikely to see a major benefit in the very short run due to limited domestic investment and weak economic data, the bank adds.
Credit Agricole believes the RBI will not cut rates to boost economic growth, which will also limit the rupee's gains.
RBI widely expected to keep interest rates on hold on Tuesday.