Rupee jumps 119 paise to 90.30 against the US dollar on India-US trade deal
Mumbai (PTI): The rupee appreciated 119 paise to 90.30 against the US dollar in early trade on Tuesday, after US tariffs on India were cut from 50 per cent to 18 per cent.
Forex traders said the 18 per cent tariff changes the story, improving India’s relative position and reopening the door for FII participation.
At the interbank foreign exchange market, the rupee opened at 90.30 against the US dollar, registering a gain of 119 paise over its previous close of 91.49.
"The good news overnight was the US-India trade deal which was announced after a delay of almost 9 months by President Donald Trump and endorsed by PM Narendra Modi in which the trade tariffs were reduced to 18 per cent, a tad lower than what it is for Bangladesh and Pakistan our neighbours giving our exporters a relative advantage," said Anil Kumar Bhansali Head of Treasury and Executive Director Finrex Treasury Advisors LLP.
Bhansali further noted that FIIs may finally buy Indian equities after being sellers for such a long time.
"We need to wait and see the RBI stance today and in the coming days as it needs to buy the short dollar position," he added.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.20 per cent lower at 97.43.
Brent crude, the global oil benchmark, was trading lower by 0.41 per cent at USD 66.03 per barrel in futures trade.
On the domestic equity market front, the 30-share benchmark index Sensex was trading 2138.08 points or 2.62 per cent higher at 83,804.54, while the Nifty was up 607 points or 2.42 per cent at 25,695.40.
Foreign Institutional Investors offloaded equities worth Rs 1,832.46 crore on Monday, according to exchange data.
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Vijay secures majority support, set to stake claim to form Tamil Nadu govt
Chennai: After four days of political uncertainty and intense negotiations in Tamil Nadu, actor-politician Vijay is learnt to have secured the numbers required to form the government, sources said.
Supporters gathered outside Vijay’s residence in Chennai on Friday evening, raising slogans in support of Tamilaga Vettri Kazhagam soon after reports emerged that the party had managed to secure majority support.
Sources said Vijay is expected to meet Tamil Nadu Governor R. V. Arlekar on Friday evening to stake claim to form the government. The meeting is likely to take place around 6 pm.
In its electoral debut in the Tamil Nadu Assembly elections, TVK won 108 out of the 234 seats, dealing a major blow to the 62-year political dominance of Dravida Munnetra Kazhagam and All India Anna Dravida Munnetra Kazhagam.
However, Governor Arlekar had reportedly made it clear that the party would not be invited to form the government without proving a clear majority. Even after two rounds of discussions on Wednesday and Thursday, the Governor is learnt to have maintained his stand that letters of support from at least 118 MLAs must be submitted in the 234-member Assembly.
Apart from Vijay, TVK had the backing of 107 MLAs. Vijay had contested from Tiruchy (East) and Perambur constituencies and won both seats, meaning he would have to resign from one seat before taking oath. This increased the need for additional support.
Amid the political developments, five MLAs from the Congress party, which reportedly moved away from the DMK-led alliance, extended support to Vijay. Vijay also held discussions with leaders of Viduthalai Chiruthaigal Katchi, Communist Party of India (Marxist) and Communist Party of India.
The VCK, CPI(M) and CPI had so far been allies of the DMK. At the same time, political discussions intensified in the state over speculation that the DMK could even explore a post-poll understanding with its long-time rival AIADMK to prevent an alternative government from taking shape.
Reports had been circulating since Friday afternoon that the VCK and Left parties were likely to support Vijay. Sources later said that the VCK, CPI(M) and CPI agreed to extend the support of two MLAs each, helping TVK cross the required majority mark.
All eyes are now on the Governor’s next move and the official announcement regarding the formation of the new government in Tamil Nadu.
