One must not the external factors that affect the rupee dollar relation. If there is a significant terror attack in Mumbai or Bangalore damaging IT infrastucture.. FII's will run with their money. Rupee will fall.
Chances of war between India and Pak seem quite low at this time but things between these two nations change quickly and this will be a burden on economy as the Iraq war is on US and this will bring down rupee. Third factor is Oil.. Oil is traded only in USD so if the oil prices go up significantly more USD will be in demand and thus disturbing the rupee dollar relation..
Of course none of this are very likely at the moment but their re
