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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EAM Jaishankar meets Jamaican PM, gifts over 10 BHISHM Cubes
Kingston (PTI): External Affairs Minister S Jaishankar on Monday met Jamaican Prime Minister Andrew Holness and discussed ways to further deepen "political, economic and people-to-people cooperation."
Jaishankar also conveyed greetings from Prime Minister Narendra Modi to Holness.
"Pleased to call on Prime Minister @AndrewHolnessJM in Kingston. Conveyed the greetings of PM @narendramodi," Jaishankar posted on X.
"Discussed deepening our political, economic and people-to-people cooperation. Value his commitment towards further strengthening India-Jamaica relations," the post further read.
Also, the external affairs minister handed over 10 BHISHM (Bharat Health Initiative for Sahyog Hita & Maitri) Cubes as a gift to Jamaica.
"Formally handed over 10 BHISHM Cubes as a gift from India to Jamaica, in the presence of PM @AndrewHolnessJM, Health Minister @christufton and FM @kaminajsmith," Jaishankar posted on X.
"The BHISHM Cube mobile hospital system, designed for rapid deployment, will help Jamaica during disasters and emergencies. The gift of these cubes is a statement of friendship, a commitment to disaster preparedness, and an outcome of innovation," the post said.
Jaishankar arrived in Kingston on Saturday evening, marking the first leg of his nine-day tour of Jamaica, Suriname, and Trinidad and Tobago, aimed at further strengthening India's strategic and cultural ties with the Caribbean nations.
Earlier in the day, he interacted with the Indian diaspora and discussed India's ongoing transformation in infrastructure, human development and technology-driven governance and entrepreneurship with them.
He also highlighted the cricket bond between both countries as India gifted a scoreboard to Jamaica.
A scoreboard was dedicated at Sabina Park in Kingston. It is the home of the Jamaica cricket team and is the only Test cricket ground in the Caribbean island nation.
The minister expressed hope that the new scoreboard would witness many memorable innings, including those symbolising the enduring friendship between the two countries.
Cricket has long been a strong cultural bridge between India and Jamaica, which is part of the West Indies cricket team.
Jamaican players, including Chris Gayle, Courtney Walsh and Michael Holding, have played a major role in shaping the legacy of West Indies cricket in the international arena, contributing to its dominance in earlier decades and its continued global appeal.
