Investors are anxious over the US-China trade tension, a sharp devaluation in yuan and uncertainty over Kashmir issue.
Foreign investors pumped in Rs 11,119 crore in the Indian equities in December, making it the second consecutive monthly inflow, despite increasing concerns over the re-emergence of Covid-19 cases in some parts of the world. However, foreign portfolio investors (FPIs) have turned cautious in recent days. The inflow in December was much lower compared to Rs 36,239 crore invested by FPIs in the month of November, data with the depositories showed.
A depreciating rupee, which briefly hit 80 to the dollar on Tuesday, may boost India's exports but price-inelastic imports of crude oil and gold would mean limited relief on the trade deficit, which clocked a record $26.2 billion in June. Due to global risk aversion on the back of geo-political tensions and aggressive policy tightening by the Fed, the dollar has appreciated against most currencies, including the rupee. And, with other currencies depreciating, India's comparative advantage in this respect may be limited.
A lower opening in the domestic equity market put pressure on the rupee.
Forex dealers said strength in euro against the US dollar overseas and increased capital inflows supported the rupee.
Iran has offered to help India meet its energy needs by relaunching rupee-rial trade for export of oil and gas, said Iranian ambassador to India Ali Chegeni. Chegeni said if both the countries resume rupee-rial trade, bilateral trade can touch $30 billion. Iran used to be India's second largest oil supplier but New Delhi had to halt imports after the former US president Donald Trump withdrew from the nuclear deal with Iran and re-imposed sanctions on its oil exports.
Crypto exchange WazirX has said customers affected by the recent cyber attack will not be able to recover their full funds even as the firm looks to restructure. At a virtual press conference, the firm's advisor said at best the company might look to return 55-57 per cent of the money. "This is what can be returned to users with the benefit of this restructuring," said Jason Kardachi, managing director (restructuring), Kroll.
The dollar index surged to multi-year high.
The rupee fell back sharply against the pound sterling at 83.28 from Monday's close of 82.49 and also reacted downwards against the euro to 71.59 from 71.29.
The butchering of the Indian Rupee need not come in the way of your dream international vacation says Anita Rao Kashi.
The rupee fell to an all-time low of 61.21 per dollar, forcing the Reserve Bank of India to intervene to stabilise the currency.
In addition, persistent dollar demand from banks and importers and a weak opening in the equity market also put pressure on the Indian rupee.
The flow of deposits from non-resident Indians (NRIs) hit a four-year low in the financial year 2020-21 mainly due to contraction in foreign currency deposits, latest data released by the Reserve Bank of India (RBI) shows. Total NRI deposits during FY21 were $7.3 billion as compared to $8.6 billion in FY20 - the lowest since 2016-17, when such deposits had contracted by $12.3 billion. Indian banks have three kinds of deposit accounts where NRIs or PIOs (persons of Indian origin) can park their funds: non-resident external-rupee account (NRE); non-resident ordinary rupee account (NRO); and foreign currency non-resident bank account (FCNR [B]).
The Indian rupee, which is partially convertible, will move toward fuller convertibility in a gradual and calibrated manner, Finance Minister P Chidambaram informed the Rajya Sabha on Tuesday.
He had taken charge as the 25th director general of the Indian Coast Guard on July 19 last year.
The Indian rupee on Monday appreciated by 16 paise against the American currency in early trade on hopes of increased capital inflows from foreign funds boosted by last week's rally in the stock markets.
Asian stock, bond and currency markets took another big hit after a fresh spike in US interest rates re-ignited concerns about capital flows from the region and forced investors to pare back their Asian portfolios.
Domestic air passenger traffic touched 1.25 crore in January this year, an increase of 96 per cent compared to the year-ago period, according to rating agency Icra. However, it said the traffic remained around 2 per cent lower compared to the pre-Covid levels -- January 2020. The traffic stood at 64 lakh in January last year. Icra is maintaining a negative outlook on the Indian aviation industry, reflecting the view that the financial performance of Indian airlines is likely to remain under pressure in the near term, even though the recovery in domestic passenger traffic has been healthy.
'Earlier, he was a bowler batters were looking to face because he hardly had any change of pace.' 'Now, he is the bowler batters do not want to face because they don't know what he is going to bowl.'
If there was one event that made the month of August stand out, it was a strengthening of the dollar index to levels last seen only 20 years ago, as the Federal Reserve dispelled all doubts about its intention to continue raising interest rates. Predictably, most currencies suffered against the US unit, with the bulk of the losers belonging to the emerging markets pack. Amid the volatility, the rupee, however, has displayed significant resilience and fared much better than most of its peer currencies.
Delhi-NCR and Mumbai are still the most preferred destinations for NRIs to buy property, say property brokers.
Forex dealers said besides continued demand for the American currency from importers, increased capital outflows by foreign funds kept pressure on the rupee.
At interactions last week with senior officials from the Reserve Bank of India, select banks gave feedback on two key bond market concerns, namely, recent volatility in the rupee-dollar exchange rate and heavy losses incurred on floating rate government bonds due to a demand-supply mismatch, sources told Business Standard. The discussions were held ahead of the RBI's next monetary policy statement, scheduled on August 5. Indian banks are large holders of government securities because of a regulatory mandate to set aside a certain percentage of deposits in sovereign bonds.
Leading index provider Standard & Poor's on Thursday announced the launch of currency indices - Indian Rupee index and Chinese Renminbi index. Global investors would get access to the currencies of the two emerging economic superpowers, it will also serve as a reliable and relative benchmark for currency performance. The indices will replicate the performance of the Chinese Renminbi & the Indian Rupee versus the US Dollar. The indices will also have an excess return version.
A sojourn in Seoul, one of Asia's largest metropolises, where the ultra-modern coexists with the ancient -- temples and palaces with futuristic skyscrapers climbing to the stratosphere, K-pop with Buddhism, a village within city limits.
'If you see another 1000-point correction, people may start panicking.'
The Indian rupee today dipped to a two-year low of 46 against the US dollar following heavy demand from importers for the greenback.
'If you want to win you need to perform.' 'Governments have found a way to buck anti-incumbency, but one policy intervention will not pay in all elections.'
Weak dollar in the overseas market also boosted the rupee value against the dollar, a forex dealer said.
Analysts expect the central bank to remain watchful of inflation.
The Rupee is 3.7 per cent undervalued on trade related basis.
This is rupee's lowest since 62.32 on January 9.
After declining for three consecutive quarters, the value of FPI investment in Indian equities rose 8 per cent quarter-on-quarter to $566 billion in the July-September period, according to a Morningstar report on Wednesday. A fast-changing global macroeconomic landscape, sentiments and opportunities that the Indian equity markets have to offer impacted the direction of flows by Foreign Portfolio Investors (FPIs). Through the quarter, the value of the FPI holdings in domestic equities surged by 8 per cent to $566 billion from $523 billion recorded in the previous quarter.
Despite the rally in equities over the last few years, India, according to Christopher Wood, global head of equity strategy at Jefferies, is still in early stages of an equity cult. Any changes to the capital gains tax for equities - both long-term and short-term - in Budget 2024 scheduled to be announced on July 23, he believes, can trigger a bigger correction that what the markets witnessed post the Lok Sabha election outcome on June 4 that saw the Bharatiya Janata Party (BJP) lose majority, though it was able to form the government with the help of coalition partners.
The global brokerage firm further said that BoP would be INR-supportive.
The December meeting of the Reserve Bank of India's (RBI's) six-member Monetary Policy Committee (MPC) will start on Wednesday even as there is no clarity on whether Governor Shaktikanta Das, the chair of the panel, will continue in office after his term ends next week. The outcome of the meeting will be announced on Friday by Das at 10 in the morning.
Dealers said the sharp recovery of the rupee was because of restrictions imposed by the RBI on forward trading in the local currency by foreign institutional investors and traders, besides the cap fixed on banks' exposure to the forex market.
The dollar index was down by 0.16 per cent against its six major global rivals.
