The document discusses the factors contributing to the depreciation of the Indian rupee against the US dollar. It notes that recession in developed economies like the US has led to outflows of money from India. Additionally, concerns over defaults by European nations have resulted in loss of confidence in the euro and appreciation of the dollar. Investors also view the dollar as a safe currency due to fears of a bubble bursting in gold. This has led to a widening trade deficit and spike in dollar demand, putting pressure on the rupee. The current account deficit is expected to be between 3.0-3.1% of GDP by March 2012.