Rupee sees high volatility against US dollar in early trade
Mumbai (PTI): The rupee witnessed high volatility in early trade on Wednesday, as support from easing crude oil prices was offset by uncertainty over the India-US trade deal and persistent foreign fund outflows.
Forex traders said the key driver of rupee weakness in December was continued FPI selling across both equity and debt markets, with foreign investors repeatedly selling several billion dollars’ worth of Indian assets on a daily basis in the last few months, the selling intensifying in the last two months.
ALSO READ: Rupee falls 9 paise to record low of 90.87 against US dollar in early trade
However, with Brent crude oil prices hovering near recent multi-year lows of USD 59 per barrel, the local unit was supported at lower levels.
At the interbank foreign exchange market, the rupee opened at 91.05 against the US dollar, down 12 paise from its previous close.
The domestic unit, however, witnessed a sharp recovery and appreciated 97 paise to touch an early high of 89.96 against the American currency and was trading at 90.18 against the US dollar at 09.46 hrs.
On Tuesday, the rupee tanked below 91 per dollar, hitting a low of 91.14. It finally settled at 90.93 against the American currency.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.17 per cent higher at 98.31.
Brent crude, the global oil benchmark, was trading at USD 59.54 per barrel in futures trade, as record non-OPEC supply, weak China data and optimism over a Ukraine ceasefire were the main reasons for the current fall, traders said.
Meanwhile, Minister of State for Finance Pankaj Chaudhary on Tuesday informed Parliament that, "During the current financial year, the depreciation of the INR has been influenced by the increase in trade deficit and likely prospects arising from the ongoing developments in India's trade agreement with the US, amid relatively weak support from the capital account."
"The depreciation of currency is likely to enhance export competitiveness, which in turn impacts the economy positively. On the other hand, depreciation may raise the prices of imported goods. However, the overall impact of exchange rate depreciation on domestic prices depends on the extent of the pass-through of international commodity prices to the domestic market," he said.
On the domestic equity market front, the 30-share benchmark index Sensex was trading 146.09 points higher at 84,825.95, while the Nifty was up 62.05 points at 25,922.15.
Foreign Institutional Investors sold equities worth Rs 2,381.92 crore on Tuesday, according to exchange data.
According to Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP, the rupee may see a slow and steady move towards 92 in the coming days, with no signs of any trade deal happening between India and the US, which has also been a cause for the equities to fall.
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Nightclub fire: Luthra brothers brought to Goa from Delhi
Panaji (PTI): Gaurav and Saurabh Luthra, co-owners of the Birch by Romeo Lane nightclub, were brought to Goa from Delhi on Wednesday after being deported from Thailand in connection with the December 6 fire incident that killed 25 persons.
They will be interrogated by the Goa Police in connection with the devastating fire at the nightclub in Arpora, North Goa, an official said.
A team of the Goa Police, along with the Luthra brothers, landed at the Manohar International Airport, Mopa, in North Goa at 10.45 am.
ALSO READ: Goa nightclub fire: Luthra brothers deported from Thailand, taken into police custody
They are likely to be taken to the Anjuna police station for questioning. The accused will also be produced before a court in Mapusa town for their regular remand, the official said.
After the fire tragedy, the Anjuna police had registered a case against the Luthra brothers on various charges, including culpable homicide not amounting to murder.
The Luthra brothers were arrested on Tuesday as soon as they landed in Delhi after being deported from Thailand. A court there allowed the Goa Police their two-day transit remand.
The duo had fled to Phuket (Thailand) early on December 7, hours after the fire at their nightclub, prompting the authorities to issue an Interpol Blue Corner Notice and cancel their passports.
They were detained by Thai authorities at Phuket on December 11 following a request from the Indian government, which later coordinated with officials in Thailand to deport them under legal treaties between the two nations.
Five managers and staff members have already been arrested by the Goa Police in connection with the fire.
