The depreciation of the US dollar in 2011 will offset the pressure on the rupee owing to Mauritius's large current-account deficit, and we forecast that it will appreciate from an average of MRs30.8:US$1 in 2010 to MRs28.9:US$1 in 2011. The position will reverse in 2012, when the dollar is expected to strengthen against the euro, as concerns over debt in the euro area reassert themselves following the raising of US interest rates. As a result, we forecast an exchange rate of MRs31:US$1 in 2012. The average exchange rate of the rupee against the euro, which appreciated by more than 9% in 2010, will be little changed in 2011-12. This may cause some discomfort to exporters and tourism operators, most of whose sales are denominated in euros.