Rupee may trade in 55.30/56.30 per dlr

He also said that global factors like debt crisis in the euro zone would affect the currency more in the coming weeks.

Rupee has been the worst performing currency in Asia over the last few months owing to structural issues faced by the Indian economy like high fiscal and current account deficits and low capital inflows.

While fiscal deficit has widened to 5.7 per cent in the last financial year,current account deficit is likely to touch around four percent in FY12.

Similarly,strengthening of dollar against other currencies,especially euro,has put further pressure on the domestic currency.

However,Venkatesh said if the government comes up with some policy measures to attract capital flows,rupee may recoup to 54 levels by end of June.

Another bank official also remarked that rupee can recoup to Rs 54 level if things improve on the policy front.

“Rupee can recoup to Rs 54 level if certain policy decisions are taken by the government. Otherwise,the market participants are in a wait and watch mode as of now,” General Manager(treasury)of Indian Overseas Bank,T S Srinivasan said.

However,rupee can slip to 56 levels in the absence of any credible policy measures as fundamentals of the local currency remain weak,he remarked.