Rupee Crashes To Lifetime Low of 69 Against US Dollar
New Delhi : The rupee fell to an all-time low against the US dollar on Thursday tracking Asian peers, with weakening macro-economic fundamentals on the domestic front also weighing on the currency. The dollar's sharp gain overnight coupled with falls in Asian peers caused the drop in early trade, traders said, adding they were hopeful the central bank would step in to prevent further losses. The rupee was trading at 68.92/93 to the dollar at 11.12 am, after hitting a life low of 69.0950 earlier in the session, and sharply lower than its previous close of 68.65/66.
The rupee's last record low was 68.8650 per dollar, hit on November 24, 2016.
The dollar was, however, steady against its peers on Thursday, having failed to extend overnight gains amid conflicting signals from Washington on a proposal to restrict Chinese investment as the bitter U.S.-China trade row kept financial markets on edge.
On the domestic front, a widening current account deficit (CAD) due to higher global crude oil prices and steady capital outflows have weighed on the rupee this year.
"Weakening at this pace shatters confidence. Markets expect RBI (Reserve bank of India) to manage the currency more effectively. The pressure on INR is high, thus in the absence of major action from regulators, 70 levels can be seen," the head of currency and debt trading at a foreign bank said. "The RBI has been effectively managing (the rupee) over the years, and they do have ample firepower to manage sharp falls."
Foreign exchange reserves stood at $410.07 billion as of June 15, latest RBI data showed.
Oil prices have been rallying for much of 2018 on tightening market conditions due to record demand and voluntary supply cuts led by the Organization of the Petroleum Exporting Countries (OPEC).
Economy's March quarter CAD widened to $13.0 billion, or 1.9 per cent of GDP, from $2.6 billion, or 0.4 per cent of GDP, from a year earlier. Despite the rise in CAD, it remains modest relative to GDP and is largely financed by equity inflows, including foreign direct investment (FDI), Moody's said in a note on Thursday, adding that the large foreign exchange reserves provided a good buffer.
"India's low dependence on foreign-currency borrowing to fund its debt burden limits the risk of currency depreciation transmitting into materially weaker debt affordability," Moody's added.
courtesy : ndtv.com
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Dy CM Shivakumar confident of Congress win in Karnataka bypolls
Bengaluru (PTI): Karnataka Deputy Chief Minister D K Shivakumar on Saturday expressed confidence that the ruling Congress will secure a decisive victory in the Assembly bypolls scheduled for April 9 in the Bagalkote and Davanagere South constituencies, citing a favourable ground response to the party’s guarantee schemes.
These are ‘Shakti’, ‘Gruha Lakshmi’, ‘Gruha Jyoti’, ‘Yuva Nidhi’ and ‘Anna Bhagya’.
The bypolls were necessitated by the demise of sitting Congress MLAs Shamanur Shivashankarappa and H Y Meti, who represented Davanagere South and Bagalkote constituencies, respectively.
The Congress has fielded Shivashankarappa’s grandson, Samarth Shamanur, in Davanagere South and Umesh Meti in Bagalkote. They are locked in direct contests with BJP candidates T Dasakariyappa and Veerabhadrayya Charantimath.
“Both Bagalkote and Davanagere are very positive. Congress workers are doing an excellent job, going door to door and convincing people about the guarantee schemes,” Shivakumar told reporters here.
He said even voters who had earlier supported the BJP were now inclined towards the Congress.
“Even those who voted for the BJP earlier are saying they will vote for Congress. People want the guarantees to continue and are expressing difficulties due to rising prices,” he said.
Expressing confidence of an improved electoral performance, he added, “There is a strong sense that we will win with a bigger margin than before.”
Shivakumar also said he would travel to Kerala for two days and resume campaigning thereafter. “I am going to Kerala for two days. After returning, we will continue the campaign from Davanagere,” he said.
Referring to the shortage of LPG, including auto LPG, in the state, Shivakumar blamed the BJP-led government and called for immediate intervention by the Centre.
“The LPG shortage is due to the BJP. Auto drivers and those in the transport sector are facing difficulties,” he claimed.
“This is something the central government has to address. It must formulate proper policies and take precautionary measures,” he said, adding that the BJP should apologise to the public.
“They should come forward and apologise to the people for the inconvenience caused and resolve the issues they have created,” he said.
