The Indian rupee remained practically steady on Wednesday, owing to a possible intervention by the Reserve Bank of India (RBI), which helped the currency escape a record low, according to traders. At 10:00 a.m. IST, the rupee stood at 83.56 against the US dollar, hardly changing&nbsp;from its previous close of 83.5650.<o:p></o:p>

<h2 class="MsoNormal">RBI's strategic intervention in the NDF market<o:p></o:p></h2>

Traders said the RBI most likely intervened in the non-deliverable forwards (NDF) market before the local spot market opened at 9:00 a.m. IST. The goal of this intervention was to keep the rupee stable. Routine interventions by the RBI, especially in the NDF market, have consistently supported the currency in recent sessions. "The RBI's intervention in the NDF market has changed...We are now quite clear and explicit that the RBI is involved in the forward market," RBI Governor Shaktikanta Das said at a post-monetary policy press conference on Friday.<o:p></o:p>

<h2 class="MsoNormal">Shift in RBI's tactics to limit volatility<o:p></o:p></h2>

The central bank's strategy for managing rupee volatility has shifted, with a concentration on non-deliverable forwards rather than direct spot market operations. Market watchers have recognised this shift in methods, and Reuters has previously reported on it. The RBI's strategic action aims to create a more stable exchange rate environment in the face of altering market conditions.<o:p></o:p>

<h2 class="MsoNormal">Market reactions and future expectations<o:p></o:p></h2>

Local oil companies have placed dollar bids, but the currency is expected to trade in a restricted range due to the RBI's indication to the market that it will intervene to prevent further devaluation. "The RBI has signalled&nbsp;to the market that it will prevent further weakness," a foreign exchange trader at a state-run bank said. The dollar index held at 105.3, while most Asian currencies remained range-bound as investors awaited critical US consumer inflation data and the Federal Reserve's policy announcement later that day. <o:p></o:p>

The Fed is expected to hold rates steady, but new interest rate estimates will be widely watched. "Asia FX may face volatility from a potential upward shift in the Fed's median dot plot, which could push US yields and the US dollar higher," said Lloyd Chan, senior currency strategist at MUFG Bank.<o:p></o:p>

(With inputs from Agencies)<o:p></o:p>

<o:p></o:p>

The Indian rupee remained practically steady on Wednesday, owing to a possible intervention by the Reserve Bank of India (RBI), which helped the currency escape a record low, according to traders.

The Indian rupee remained practically steady on Wednesday, owing to a possible intervention by the Reserve Bank of India (RBI), which helped the currency escape a record low, according to traders. At 10:00 a.m. IST, the rupee stood at 83.56 against the US dollar, hardly changing from its previous close of 83.5650. RBI's strategic intervention in the NDF market Traders said the RBI most likely intervened in the non-deliverable forwards (NDF) market before the local spot market opened at 9:00 a.m. IST. The goal of this intervention was to keep the rupee stable. Routine interventions by the RBI, especially in the NDF market, have consistently supported the currency in recent sessions. "The RBI's intervention in the NDF market has changed...We are now quite clear and explicit that the RBI is involved in the forward market," RBI Governor Shaktikanta Das said at a post-monetary policy press conference on Friday. Shift in RBI's tactics to limit volatility The central bank's strategy for managing rupee volatility has shifted, with a concentration on non-deliverable forwards rather than direct spot market operations. Market watchers have recognised this shift in methods, and Reuters has previously reported on it. The RBI's strategic action aims to create a more stable exchange rate environment in the face of altering market conditions. Market reactions and future expectations Local oil companies have placed dollar bids, but the currency is expected to trade in a restricted range due to the RBI's indication to the market that it will intervene to prevent further devaluation. "The RBI has signalled to the market that it will prevent further weakness," a foreign exchange trader at a state-run bank said. The dollar index held at 105.3, while most Asian currencies remained range-bound as investors awaited critical US consumer inflation data and the Federal Reserve's policy announcement later that day. The Fed is expected to hold rates steady, but new interest rate estimates will be widely watched. "Asia FX may face volatility from a potential upward shift in the Fed's median dot plot, which could push US yields and the US dollar higher," said Lloyd Chan, senior currency strategist at MUFG Bank. (With inputs from Agencies)

RBI intervention helps the Indian Rupee avoid record-low

<h2 class="MsoNormal">The rupee remains flat against the dollar<o:p></o:p></h2>

The Indian rupee traded nearly flat on Tuesday, with traders anticipating little movement as the Reserve Bank of India (RBI) continued to control large falls and reduce short-term volatility. At 09:50 a.m. IST, the rupee was valued at 83.4975 per US dollar, up slightly from its previous closing of 83.5050.<o:p></o:p>

<h2 class="MsoNormal">RBI's strategic interventions<o:p></o:p></h2>

On Monday, the rupee remained in a restricted trading range, most likely due to RBI interventions that limited the currency's decline. The central bank's initiatives have helped to reduce the near-term volatility of the dollar-rupee exchange rate. The one-month implied volatility has declined to 2.20 per cent, down from a six-month high of 3.35 per cent in late May, shortly before India's national election results on June 4.<o:p></o:p>

<h2 class="MsoNormal">Stable exchange rates expected<o:p></o:p></h2>

Traders anticipate the rupee will not go "much below 83.50," as continued dollar sales from state-run banks, presumably on behalf of the RBI, sustain the currency. The dollar index stood at 105.1, while most Asian currencies fell ahead of the announcement of US inflation data and the Federal Reserve's policy decision, which is due on Wednesday.<o:p></o:p>

<h2 class="MsoNormal">Market awaits Federal Reserve's policy decision<o:p></o:p></h2>

The Federal Reserve is widely expected to maintain policy rates steady. Investors will, however, closely scrutinize Fed Chair Jerome Powell's words as well as any modifications to the interest rate dot plot. Interest rate futures are now pricing in around 38 basis points of rate reduction through 2024, down from nearly 50 basis points the previous week.<o:p></o:p>

Anil Bhansali, head of treasury at Finrex Treasury Advisors, said that the rupee's price action will mirror Monday's, with market participants keeping a close eye on the RBI's activities and the 83.50 level.<o:p></o:p>

(With inputs from Agencies)<o:p></o:p>

The rupee remains flat against the dollar The Indian rupee traded nearly flat on Tuesday, with traders anticipating little movement as the Reserve Bank of India (RBI) continued to control large falls and reduce short-term volatility.

The rupee remains flat against the dollar The Indian rupee traded nearly flat on Tuesday, with traders anticipating little movement as the Reserve Bank of India (RBI) continued to control large falls and reduce short-term volatility. At 09:50 a.m. IST, the rupee was valued at 83.4975 per US dollar, up slightly from its previous closing of 83.5050. RBI's strategic interventions On Monday, the rupee remained in a restricted trading range, most likely due to RBI interventions that limited the currency's decline. The central bank's initiatives have helped to reduce the near-term volatility of the dollar-rupee exchange rate. The one-month implied volatility has declined to 2.20 per cent, down from a six-month high of 3.35 per cent in late May, shortly before India's national election results on June 4. Stable exchange rates expected Traders anticipate the rupee will not go "much below 83.50," as continued dollar sales from state-run banks, presumably on behalf of the RBI, sustain the currency. The dollar index stood at 105.1, while most Asian currencies fell ahead of the announcement of US inflation data and the Federal Reserve's policy decision, which is due on Wednesday. Market awaits Federal Reserve's policy decision The Federal Reserve is widely expected to maintain policy rates steady. Investors will, however, closely scrutinize Fed Chair Jerome Powell's words as well as any modifications to the interest rate dot plot. Interest rate futures are now pricing in around 38 basis points of rate reduction through 2024, down from nearly 50 basis points the previous week. Anil Bhansali, head of treasury at Finrex Treasury Advisors, said that the rupee's price action will mirror Monday's, with market participants keeping a close eye on the RBI's activities and the 83.50 level. (With inputs from Agencies)

Indian Rupee holds steady amid RBI interventions

India’s Finance Minister Nirmala Sitharaman has said that about 22 countries are in talks with New Delhi to seek possibilities of conducting bilateral trade in the rupee.

In an interview with the news channel NDTV, Sitharaman said, “Also many of those countries are running short on dollar reserves, but yet their basic trade cannot be stopped."&nbsp;

"So they see the Indian rupee as a stable currency," she added.

The minister also added that India better understands the needs of the developing world and its leadership aimed at bringing them aboard the global developmental agenda.

Watch:&nbsp;Rupee inches to replace Dollar in global trade; 18 countries agree on rupee-trade mechanism

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"And for achieving their development goals, they find it easy to talk to us about having rupee trade," she said.

It must be noted that the de-dollarisation efforts have gained momentum around the world in the wake of the Russia-Ukraine war. Countries around the world have grown insecure over the West’s monopoly of the global trade system after it slapped unilateral sanctions on Russia.

<h2>Sitharaman hails G20 success</h2>

The finance minister also hailed the historic G20 summit held in New Delhi last week as successful, adding that it gave hope for multilateralism.

“The maturity with which Indian teams handled the G20 document at various stages makes it historic," Sitharaman said.&nbsp;

"The team that largely consisted of women did brilliant work. There was a spirit of cooperation among the countries," she said, adding, “The spirit with which we worked that gave of hope of multilateralism.”&nbsp;

<h2>Internationalisation of Indian Rupee</h2>

Earlier in March, Indian media reported that at least 18 nations had agreed to settle their bilateral trade with India in rupees.&nbsp;

India’s central bank, the Reserve Bank of India, had allowed 18 nations, such as Germany, Singapore, Sri Lanka, UK, Kenya and many others, to conduct bilateral trade in rupee. 
 
In fact, India has already begun trading in rupees with many of its neighbouring countries like Nepal and Bhutan.

India’s Minister of State for Commerce and Industry Anupriya Patel had told Parliament in August that a significant part of the India-Nepal trade was being done in Indian rupees.

<a href="https://www.wionews.com/business-economy/india-to-offer-russia-to-invest-trapped-rupees-serei-lavrov-634749">Also read:&nbsp;India to offer Russia to invest trapped rupees: Sergey Lavrov</a>

Also, all bilateral trade with Bhutan was also being conducted in rupees only.

"Rupee trade mechanism has been initiated to facilitate trade in national currency with Russia. As of July 2, RBI has approved 34 applications from different Russian banks for opening SRVA in 14 Indian commercial banks," the minister said in a written reply.

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India’s Finance Minister Nirmala Sitharaman has said that about 22 countries are in talks with New Delhi to seek possibilities of conducting bilateral trade in the rupee.

India’s Finance Minister Nirmala Sitharaman has said that about 22 countries are in talks with New Delhi to seek possibilities of conducting bilateral trade in the rupee. In an interview with the news channel NDTV, Sitharaman said, “Also many of those countries are running short on dollar reserves, but yet their basic trade cannot be stopped." "So they see the Indian rupee as a stable currency," she added. The minister also added that India better understands the needs of the developing world and its leadership aimed at bringing them aboard the global developmental agenda. Watch: Rupee inches to replace Dollar in global trade; 18 countries agree on rupee-trade mechanism × "And for achieving their development goals, they find it easy to talk to us about having rupee trade," she said. It must be noted that the de-dollarisation efforts have gained momentum around the world in the wake of the Russia-Ukraine war. Countries around the world have grown insecure over the West’s monopoly of the global trade system after it slapped unilateral sanctions on Russia. Sitharaman hails G20 success The finance minister also hailed the historic G20 summit held in New Delhi last week as successful, adding that it gave hope for multilateralism. “The maturity with which Indian teams handled the G20 document at various stages makes it historic," Sitharaman said. "The team that largely consisted of women did brilliant work. There was a spirit of cooperation among the countries," she said, adding, “The spirit with which we worked that gave of hope of multilateralism.” Internationalisation of Indian Rupee Earlier in March, Indian media reported that at least 18 nations had agreed to settle their bilateral trade with India in rupees. India’s central bank, the Reserve Bank of India, had allowed 18 nations, such as Germany, Singapore, Sri Lanka, UK, Kenya and many others, to conduct bilateral trade in rupee. In fact, India has already begun trading in rupees with many of its neighbouring countries like Nepal and Bhutan. India’s Minister of State for Commerce and Industry Anupriya Patel had told Parliament in August that a significant part of the India-Nepal trade was being done in Indian rupees. Also read: India to offer Russia to invest trapped rupees: Sergey Lavrov Also, all bilateral trade with Bhutan was also being conducted in rupees only. "Rupee trade mechanism has been initiated to facilitate trade in national currency with Russia. As of July 2, RBI has approved 34 applications from different Russian banks for opening SRVA in 14 Indian commercial banks," the minister said in a written reply. WATCH WION LIVE HERE ×

At least 22 nations in talks with India to trade in rupee: Finance minister

The Indian Rupee depreciated for the fourth straight day and settled 9 paise lower at its lifetime low of 83.22 (provisional) against the US dollar on Thursday (Sept. 7)&nbsp;amid a firm American currency and elevated crude oil prices.

Positive trend in the domestic equity markets, however, provided a cushion to the rupee, according to forex traders.

Crude oil breached the USD 90 per barrel-mark after oil producing countries agreed to extend supply cut till December this year while dollar stayed firm on safe-haven demand.

At the interbank foreign exchange, the rupee opened at 83.15 against the dollar and traded in the range of 83.12 to 83.22 against the greenback. It ended at the lowest level of 83.22 (provisional) against the dollar, registering a fall of 9 paise from its previous close.

On Wednesday, the rupee settled 9 paise lower at 83.13 against the dollar. Earlier, the Indian currency had closed at the same level of 83.13 on August 21.

The domestic unit has declined 60 paise since Monday when it had closed 9 paise lower at 82.71 against the greenback. On Tuesday, the unit had plunged 33 paise, the sharpest fall this week.

WATCH:&nbsp;German Chancellor Olaf Scholz: Excessive bureaucracy paralyses economy

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"We expect rupee to trade with a negative bias on strong dollar and elevated crude oil prices. Disappointing European data may further support dollar. Rising US treasury yields and concerns over global economic growth may also weigh on rupee," Anuj Choudhary - Research Analyst at Sharekhan by BNP Paribas, said.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, rose by 0.09 per cent to 104.95.

Brent crude futures, the global oil benchmark, was trading 0.39 per cent lower at USD 90.25 per barrel.

<a href="https://www.wionews.com/business-economy/forecast-chinas-slowdown-means-it-may-not-surpass-us-economy-632540">Also read:&nbsp;Forecast: China’s slowdown means it may not surpass US economy</a>

On the domestic equity market front, the BSE Sensex closed 385.04 points or 0.58 per cent higher at 66,265.56 points while the broader Nifty jumped 116 points or 0.59 per cent to end at 19,727.05 points.

Foreign Institutional Investors (FIIs) were net sellers in the capital market on Wednesday as they offloaded shares worth ₹ 3,245.86 crore, according to exchange data.

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The Indian Rupee depreciated for the fourth straight day and settled 9 paise lower at its lifetime low of 83.22 (provisional) against the US dollar on Thursday (Sept.

The Indian Rupee depreciated for the fourth straight day and settled 9 paise lower at its lifetime low of 83.22 (provisional) against the US dollar on Thursday (Sept. 7) amid a firm American currency and elevated crude oil prices. Positive trend in the domestic equity markets, however, provided a cushion to the rupee, according to forex traders. Crude oil breached the USD 90 per barrel-mark after oil producing countries agreed to extend supply cut till December this year while dollar stayed firm on safe-haven demand. At the interbank foreign exchange, the rupee opened at 83.15 against the dollar and traded in the range of 83.12 to 83.22 against the greenback. It ended at the lowest level of 83.22 (provisional) against the dollar, registering a fall of 9 paise from its previous close. On Wednesday, the rupee settled 9 paise lower at 83.13 against the dollar. Earlier, the Indian currency had closed at the same level of 83.13 on August 21. The domestic unit has declined 60 paise since Monday when it had closed 9 paise lower at 82.71 against the greenback. On Tuesday, the unit had plunged 33 paise, the sharpest fall this week. WATCH: German Chancellor Olaf Scholz: Excessive bureaucracy paralyses economy × "We expect rupee to trade with a negative bias on strong dollar and elevated crude oil prices. Disappointing European data may further support dollar. Rising US treasury yields and concerns over global economic growth may also weigh on rupee," Anuj Choudhary - Research Analyst at Sharekhan by BNP Paribas, said. Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, rose by 0.09 per cent to 104.95. Brent crude futures, the global oil benchmark, was trading 0.39 per cent lower at USD 90.25 per barrel. Also read: Forecast: China’s slowdown means it may not surpass US economy On the domestic equity market front, the BSE Sensex closed 385.04 points or 0.58 per cent higher at 66,265.56 points while the broader Nifty jumped 116 points or 0.59 per cent to end at 19,727.05 points. Foreign Institutional Investors (FIIs) were net sellers in the capital market on Wednesday as they offloaded shares worth ₹ 3,245.86 crore, according to exchange data. WATCH WION LIVE HERE ×

Indian rupee slides to lifetime low of 83.22 against USD, crude oil breaches $90/barrel mark

India's drive to internationalise the Rupee is reaping benefits in one and a half dozen countries across the world. Banks from 18 countries have been allowed by India's central bank, Reserve Bank of India,&nbsp;to open Special Vostro Rupee Accounts (SVRAs) for settling payments in Indian rupees, the Indian government told the parliament which is currently in session.&nbsp;

The government's response came to a question from Bharatiya Janata Party’s Sushil Kumar Modi.&nbsp;

The Union Minister of State for Finance Bhagwat Kishanrao Karad said that the SVRAs could be set up by banks of partner countries by approaching Authorised Dealer (AD) banks in India that may get permission from the RBI after the due procedure.

<h2>Rupee internationalisation: Which countries can trade in Indian Rupee?</h2>

According to records shared by the Indian government in Rajya Sabha, the Indian parliament's upper house, Special Vostro Rupee Accounts can be opened in 18 countries. They are Botswana, Fiji, Germany, Guyana, Israel, Kenya, Malaysia, Mauritius, Myanmar, New Zealand, Oman, Russia, Seychelles, Singapore, Sri Lanka, Tanzania, Uganda and the United Kingdom.

In India, the process of SVRAs began in July 2022 when the RBI announced that, "it has been decided to put in place an additional arrangement for invoicing, payment, and settlement of exports/imports in INR [Indian rupees]."

Also read |&nbsp;<a href="https://www.wionews.com/business-economy/india-steps-up-rupees-internationalisation-for-sri-lankas-economic-recovery-589593">India steps up rupee's internationalisation for Sri Lanka's economic recovery</a>

"Procedures for trade in INR have been delineated by RBI in the Circular (No 10 RBI/2022-2023/90 dated 11.07.2022 on ‘International Trade Settlement in Indian rupees’. RBI has also issued Frequently Asked Questions on its website. RBI has clarified matters related to operationalisation of SRVAs through the said FAQs, which are available to banks, importers and exporters etc.,” Karad stated in the Rajya Sabha.&nbsp;

<h2>Russia top proponent of de-dollarisation move</h2>

Among the 18 countries mentioned in the government's response to the parliament, Russia has been actively advocating for the use of local currency in a broader effort to achieve "de-dollarisation."&nbsp;

On the other hand, India's interest in promoting trade in local currency primarily stems from its desire to enhance exports.

Also watch |&nbsp;The growing footprint of Indian rupee | In-Depth Analysis

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The commodities crisis was triggered by Western sanctions imposed on Russia following President Vladimir Putin's launch of offensive on Ukraine.

Over the past year, India has been actively engaging with countries like the United Arab Emirates and Australia to conclude trade agreements. Additionally, India has initiated negotiations with other significant trading partners such as the United Kingdom and the European Union to make towards adopting the Indian Rupee for bilateral and global trade.

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India's drive to internationalise the Rupee is reaping benefits in one and a half dozen countries across the world. Banks from 18 countries have been allowed by India's central bank, Reserve Bank of India, to open Special Vostro Rupee Accounts (SVRAs) for settling payments in Indian rupees, the Indian government told the parliament which is currently in session.

India's drive to internationalise the Rupee is reaping benefits in one and a half dozen countries across the world. Banks from 18 countries have been allowed by India's central bank, Reserve Bank of India, to open Special Vostro Rupee Accounts (SVRAs) for settling payments in Indian rupees, the Indian government told the parliament which is currently in session. The government's response came to a question from Bharatiya Janata Party’s Sushil Kumar Modi. The Union Minister of State for Finance Bhagwat Kishanrao Karad said that the SVRAs could be set up by banks of partner countries by approaching Authorised Dealer (AD) banks in India that may get permission from the RBI after the due procedure. Rupee internationalisation: Which countries can trade in Indian Rupee? According to records shared by the Indian government in Rajya Sabha, the Indian parliament's upper house, Special Vostro Rupee Accounts can be opened in 18 countries. They are Botswana, Fiji, Germany, Guyana, Israel, Kenya, Malaysia, Mauritius, Myanmar, New Zealand, Oman, Russia, Seychelles, Singapore, Sri Lanka, Tanzania, Uganda and the United Kingdom. In India, the process of SVRAs began in July 2022 when the RBI announced that, "it has been decided to put in place an additional arrangement for invoicing, payment, and settlement of exports/imports in INR [Indian rupees]." Also read | India steps up rupee's internationalisation for Sri Lanka's economic recovery "Procedures for trade in INR have been delineated by RBI in the Circular (No 10 RBI/2022-2023/90 dated 11.07.2022 on ‘International Trade Settlement in Indian rupees’. RBI has also issued Frequently Asked Questions on its website. RBI has clarified matters related to operationalisation of SRVAs through the said FAQs, which are available to banks, importers and exporters etc.,” Karad stated in the Rajya Sabha. Russia top proponent of de-dollarisation move Among the 18 countries mentioned in the government's response to the parliament, Russia has been actively advocating for the use of local currency in a broader effort to achieve "de-dollarisation." On the other hand, India's interest in promoting trade in local currency primarily stems from its desire to enhance exports. Also watch | The growing footprint of Indian rupee | In-Depth Analysis × The commodities crisis was triggered by Western sanctions imposed on Russia following President Vladimir Putin's launch of offensive on Ukraine. Over the past year, India has been actively engaging with countries like the United Arab Emirates and Australia to conclude trade agreements. Additionally, India has initiated negotiations with other significant trading partners such as the United Kingdom and the European Union to make towards adopting the Indian Rupee for bilateral and global trade. WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

Indian Rupee bolsters New Delhi's economic might in 18 countries

Sri Lanka has notified the Indian rupee as a designated currency, Indian External Affairs Ministry Spokesperson Arindam Bagchi said on Thursday (July 20).

"In terms of trading in our national currencies, Sri Lanka has already notified India Rupee as designated foreign currency in their system," Bachi said during a weekly media interaction in New Delhi.

Making Indian rupee (INR) a designated foreign currency enables not only trade settlement between the two countries in INR but also Indian tourists coming to Sri Lanka can use INR for transactions.

<h2>Deepening financial and economic connection</h2>

Bagchi said that the utilisation will depend on India's private sector and people who engage in the trade sector.&nbsp;

"We would like to deepen this financial and economic connection. It will be premature to comment today on it, when the visit is tomorrow," he added.

The comments came hours before Sri Lankan President Ranil Wickremesinghe&nbsp;landed in the capital New Delhi to kickstart his two-day visit to India.

<h2>Wickremesinghe in India&nbsp;</h2>

Wickremesinghe was invited by Prime Minister Narendra Modi and is the first Sri Lankan leader to visit since the island nation was hit by an unprecedented economic crisis last year.

Notably, this is also the first time that the 74-year-old Sri Lankan leader is vising India since he assumed office in July 2022 after his predecessor, Gotabaya Rajapaksa, fled Sri Lanka amid massive public protests.

President Wickremesinghe is expected to meet his Indian counterpart Droupadi Murmu and discuss various issues of mutual interest with Prime Minister Narendra Modi and other Indian dignitaries, the Ministry of External Affairs said in a press release.

The Indian Ministry of External Affairs (MEA) in a press release noted, "Sri Lanka is an important partner in India's Neighbourhood First Policy and Vision SAGAR. The visit will reinforce the longstanding friendship between the two countries and explore avenues for enhanced connectivity and mutually beneficial cooperation across sectors."

<h2>India helping Sri Lanka</h2>

Meanwhile, Bagchi earlier in the day said that Wickremesinghe's India visit is a major one as the country has important, multifaceted relations with the island nation.

"This is a very important visit, it is a neighbouring country with whom we have very important relationship, we have multifaceted relations," he said.

Ever since Sri Lanka plunged into economic chaos, India has been helping the island country by providing aid, medicines and other essential items.

Also read |&nbsp;<a href="https://www.wionews.com/south-asia/i-am-ranil-wickremesinghe-not-ranil-rajapaksa-asserts-sri-lanka-president-617364">'I am Ranil Wickremesinghe, not Ranil Rajapaksa', asserts Sri Lanka president before India visit</a>

Last year, India gave aid worth almost $4 billion, including currency support, deferred payment of loans and lines of credit for emergency purchases of food, fuel and medicines, to Sri Lanka.

Sri Lanka will now focus on grid connectivity between the two countries, port development and renewable energy projects, largely in the northern part of the island, when President Ranil Wickremesinghe visits India from July 21 for two days, Foreign Minister Ali Sabry told reporters on July 10.

&nbsp;

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Sri Lanka has notified the Indian rupee as a designated currency, Indian External Affairs Ministry Spokesperson Arindam Bagchi said on Thursday (July 20). "In terms of trading in our national currencies, Sri Lanka has already notified India Rupee as designated foreign currency in their system," Bachi said during a weekly media interaction in New Delhi.

Sri Lanka has notified the Indian rupee as a designated currency, Indian External Affairs Ministry Spokesperson Arindam Bagchi said on Thursday (July 20). "In terms of trading in our national currencies, Sri Lanka has already notified India Rupee as designated foreign currency in their system," Bachi said during a weekly media interaction in New Delhi. Making Indian rupee (INR) a designated foreign currency enables not only trade settlement between the two countries in INR but also Indian tourists coming to Sri Lanka can use INR for transactions. Deepening financial and economic connection Bagchi said that the utilisation will depend on India's private sector and people who engage in the trade sector. "We would like to deepen this financial and economic connection. It will be premature to comment today on it, when the visit is tomorrow," he added. The comments came hours before Sri Lankan President Ranil Wickremesinghe landed in the capital New Delhi to kickstart his two-day visit to India. Wickremesinghe in India Wickremesinghe was invited by Prime Minister Narendra Modi and is the first Sri Lankan leader to visit since the island nation was hit by an unprecedented economic crisis last year. Notably, this is also the first time that the 74-year-old Sri Lankan leader is vising India since he assumed office in July 2022 after his predecessor, Gotabaya Rajapaksa, fled Sri Lanka amid massive public protests. President Wickremesinghe is expected to meet his Indian counterpart Droupadi Murmu and discuss various issues of mutual interest with Prime Minister Narendra Modi and other Indian dignitaries, the Ministry of External Affairs said in a press release. The Indian Ministry of External Affairs (MEA) in a press release noted, "Sri Lanka is an important partner in India's Neighbourhood First Policy and Vision SAGAR. The visit will reinforce the longstanding friendship between the two countries and explore avenues for enhanced connectivity and mutually beneficial cooperation across sectors." India helping Sri Lanka Meanwhile, Bagchi earlier in the day said that Wickremesinghe's India visit is a major one as the country has important, multifaceted relations with the island nation. "This is a very important visit, it is a neighbouring country with whom we have very important relationship, we have multifaceted relations," he said. Ever since Sri Lanka plunged into economic chaos, India has been helping the island country by providing aid, medicines and other essential items. Also read | 'I am Ranil Wickremesinghe, not Ranil Rajapaksa', asserts Sri Lanka president before India visit Last year, India gave aid worth almost $4 billion, including currency support, deferred payment of loans and lines of credit for emergency purchases of food, fuel and medicines, to Sri Lanka. Sri Lanka will now focus on grid connectivity between the two countries, port development and renewable energy projects, largely in the northern part of the island, when President Ranil Wickremesinghe visits India from July 21 for two days, Foreign Minister Ali Sabry told reporters on July 10. WATCH WION LIVE HERE

Sri Lanka notifies Indian rupee as designated foreign currency, enabling trade

After the signing of a currency pact between India and the United Arab Emirates, Sri Lankan president Ranil Wickremesinghe has made a statement hinting at settling Sri Lanka's trade in the Indian rupee. The Sri Lankan president said that he would like to see the Indian rupee being used as much as the US dollar for foreign trade.

Sri Lanka to consider trade in Indian rupee

Two major banks in Bangladesh, including the largest state-owned lender, are planning to introduce trade transactions denominated in Indian rupees, announced officials on Friday. This move comes as Bangladesh aims to strengthen its declining foreign exchange reserves.

Traditionally, trade transactions in Bangladesh have been conducted exclusively in US dollars. However, Reuters reports that state-owned Sonali Bank and Eastern Bank have recently opened "nostro" accounts in rupees with India's State Bank of India and ICICI Bank, respectively.

<h2>Nostro bank accounts</h2>

The establishment of these nostro accounts will allow the banks to hold funds in rupees abroad and facilitate international trade and foreign exchange transactions, reports Reuters.

According to Afzal Karim, the managing director of Sonali Bank, "This is just the beginning. More banks will join us in the coming days."

The introduction of Indian rupee trade transactions is anticipated to alleviate pressure on Bangladesh's foreign reserves, he added.

Also read | <a href="https://www.wionews.com/south-asia/taliban-orders-closure-of-hair-and-beauty-salons-in-afghanistan-further-restricting-womens-rights-611826">Taliban order closure of hair and beauty salons in Afghanistan, further restricting women's rights</a>

"It will ease pressure on the foreign reserves."

The exchange rate mechanism for these transactions will be determined on a cross-currency basis by individual banks, with a formal announcement scheduled for July 11, according to Ali Reza Iftekhar, the managing director of Eastern Bank.

<h2>Why did Bangladesh introduce transactions in Indian Rupee</h2>

Talking to Reuters, Iftekhar said that by incorporating the Indian Rupee in trade with India, Bangladesh aims to establish a convenient and cost-effective mechanism for cross-border transactions.

"The use of the Indian Rupee in India-Bangladesh trade provides a convenient and cost-effective mechanism for conducting cross-border transactions, contributing to the strengthening of economic ties between the two nations," he said.

<h2>Bilateral relationship and Bangladesh's financial troubles</h2>

India stands as Bangladesh's second-largest import source after China. In the year leading up to June 2022, Bangladesh's exports to India amounted to $2 billion, while imports from India reached $13.69 billion.

Also read | <a href="https://www.wionews.com/south-asia/pakistan-thieves-would-use-police-van-to-loot-cooking-oil-now-arrested-613018">Pakistan: Gang of thieves looting cooking oil busted; used police van for crime, three arrested</a>

Bangladesh has been facing challenges in paying for imported fuel due to a shortage of US dollars. Its dollar reserves have also seen a decline of over a third since Russia's invasion of Ukraine in February 2022, reaching a seven-year low of $31.60 billion.

The devaluation of Bangladesh's currency, the 'Taka', by more than a sixth in the past 12 months through May further adds to the country's economic struggles.

(With inputs from agencies)

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Two major banks in Bangladesh, including the largest state-owned lender, are planning to introduce trade transactions denominated in Indian rupees, announced officials on Friday.

Two major banks in Bangladesh, including the largest state-owned lender, are planning to introduce trade transactions denominated in Indian rupees, announced officials on Friday. This move comes as Bangladesh aims to strengthen its declining foreign exchange reserves. Traditionally, trade transactions in Bangladesh have been conducted exclusively in US dollars. However, Reuters reports that state-owned Sonali Bank and Eastern Bank have recently opened "nostro" accounts in rupees with India's State Bank of India and ICICI Bank, respectively. Nostro bank accounts The establishment of these nostro accounts will allow the banks to hold funds in rupees abroad and facilitate international trade and foreign exchange transactions, reports Reuters. According to Afzal Karim, the managing director of Sonali Bank, "This is just the beginning. More banks will join us in the coming days." The introduction of Indian rupee trade transactions is anticipated to alleviate pressure on Bangladesh's foreign reserves, he added. Also read | Taliban order closure of hair and beauty salons in Afghanistan, further restricting women's rights "It will ease pressure on the foreign reserves." The exchange rate mechanism for these transactions will be determined on a cross-currency basis by individual banks, with a formal announcement scheduled for July 11, according to Ali Reza Iftekhar, the managing director of Eastern Bank. Why did Bangladesh introduce transactions in Indian Rupee Talking to Reuters, Iftekhar said that by incorporating the Indian Rupee in trade with India, Bangladesh aims to establish a convenient and cost-effective mechanism for cross-border transactions. "The use of the Indian Rupee in India-Bangladesh trade provides a convenient and cost-effective mechanism for conducting cross-border transactions, contributing to the strengthening of economic ties between the two nations," he said. Bilateral relationship and Bangladesh's financial troubles India stands as Bangladesh's second-largest import source after China. In the year leading up to June 2022, Bangladesh's exports to India amounted to $2 billion, while imports from India reached $13.69 billion. Also read | Pakistan: Gang of thieves looting cooking oil busted; used police van for crime, three arrested Bangladesh has been facing challenges in paying for imported fuel due to a shortage of US dollars. Its dollar reserves have also seen a decline of over a third since Russia's invasion of Ukraine in February 2022, reaching a seven-year low of $31.60 billion. The devaluation of Bangladesh's currency, the 'Taka', by more than a sixth in the past 12 months through May further adds to the country's economic struggles. (With inputs from agencies) WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

Two Bangladeshi banks introduce Indian rupee trade transactions to bolster foreign reserves

Will the Indian rupee get an international boost? Reports from cash-strapped Egypt suggest that the country may pay for imports from India in rupees. &nbsp;

Egypt's supply minister Ali Moselhy told Reuters that the country is looking to pay for imports from India, China and Russia in their local currencies instead of the US dollar.

"Nothing of the sort has been implemented but there are discussions so that we can trade in local currencies of countries like India, Russia or China," the minister told Reuters.

If Egypt ends up trading with India in rupee, it will join 18 other countries, including Germany, Kenya, Sri Lanka, Singapore, UK, where traders are allowed to import goods by paying in rupee.&nbsp;

The Egyptian minister's comment comes hours after Bloomberg reported that India was providing Egypt with a credit line worth an unspecified value. But he denied the report.&nbsp;

Moreover, Prime Minister Narendra Modi is set to visit Egypt later this month, as the two countries seek to become strategic partners.&nbsp;

The visit comes at a time when the cash-strapped country is trying to stabilise its economy.&nbsp;

The ongoing Ukraine war has rocked its tourism industry, raised commodity prices, and prompted foreign investors to pull about $20 billion out of its financial markets.

Inflation has risen sharply over the last year after a series of currency devaluations, a prolonged shortage of foreign currency and continuing delays in imports.

Recently, Egypt received a $3 billion package from the International Monetary Fund (IMF). Friendly Gulf nations too have&nbsp;pledged billions in investments to help the North African nation.&nbsp;

(With inputs from agencies)

Will the Indian rupee get an international boost? Reports from cash-strapped Egypt suggest that the country may pay for imports from India in rupees. Egypt's supply minister Ali Moselhy told Reuters that the country is looking to pay for imports from India, China and Russia in their local currencies instead of the US dollar.

Will the Indian rupee get an international boost? Reports from cash-strapped Egypt suggest that the country may pay for imports from India in rupees. Egypt's supply minister Ali Moselhy told Reuters that the country is looking to pay for imports from India, China and Russia in their local currencies instead of the US dollar. "Nothing of the sort has been implemented but there are discussions so that we can trade in local currencies of countries like India, Russia or China," the minister told Reuters. If Egypt ends up trading with India in rupee, it will join 18 other countries, including Germany, Kenya, Sri Lanka, Singapore, UK, where traders are allowed to import goods by paying in rupee. The Egyptian minister's comment comes hours after Bloomberg reported that India was providing Egypt with a credit line worth an unspecified value. But he denied the report. Moreover, Prime Minister Narendra Modi is set to visit Egypt later this month, as the two countries seek to become strategic partners. The visit comes at a time when the cash-strapped country is trying to stabilise its economy. The ongoing Ukraine war has rocked its tourism industry, raised commodity prices, and prompted foreign investors to pull about $20 billion out of its financial markets. Inflation has risen sharply over the last year after a series of currency devaluations, a prolonged shortage of foreign currency and continuing delays in imports. Recently, Egypt received a $3 billion package from the International Monetary Fund (IMF). Friendly Gulf nations too have pledged billions in investments to help the North African nation. (With inputs from agencies)

Egypt looking to pay for imports from India in rupees: Report

India and Sri Lanka stepped up their talks to proceed with trade in Indian Rupee as New Delhi and Colombo look set to expand their bilateral cooperation in "power and energy sector as well&nbsp;as aspects relating to Rupee trade".

Dr Pramod Kumar Mishra, a cabinet rank official in India's Prime Minister Narendra Modi's administration, met with Sri Lankan High Commissioner Milinda Moragoda in New Delhi on Friday to continue the bilateral dialogue between two South Asian neighbours on a number of issues, including on debt restructuring matters crucial for Colombo's economic recovery.&nbsp;

"The High Commissioner stressed the vital role that economic integration between the two countries could play in Sri Lanka's economic recovery," an official readout stated.&nbsp;

"High Commissioner Moragoda also followed up [Pramod Kumar Mishra] on a range of issues pertaining to the bilateral relationship that had been discussed during their last meeting in February," the readout added, while referring to a previous round of bilateral talks between New Delhi and Colombo that addressed former's support for latter's economic recovery alongside aforementioned matters of bilateral cooperation.

"The matters discussed included further economic integration between Sri Lanka and India, enhancing Indian investments and tourism in Sri Lanka, ways and means to further promote bilateral trade, cooperation in power and energy sector as well as aspects relating to Rupee trade," the official readout stated further.

Several banks in Sri Lanka have opened special rupee trading accounts, called Vostro accounts. This means that Sri Lankan citizens can now hold $10,000 (₹8,26,823) in physical form and for transactions with their Indian counterparts, they can use Indian rupees instead of US dollars.&nbsp;

ALSO READ |&nbsp;<a href="https://www.wionews.com/south-asia/sri-lanka-to-use-indian-rupee-for-international-trade-543895">Sri Lanka to use Indian rupee for international trade, more countries aim to follow</a>

India's Prime Minister Narendra Modi's administration since July 2022, has been looking to bring countries that are short of dollars, into its rupee settlement mechanism.

ALSO WATCH |&nbsp;Sri Lanka mull using Indian rupee for economic transactions

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Designating Indian Rupee as a legal currency in Sri Lanka has provided India's coastal neighbour at its south much-needed liquidity support to help tide over its economic crisis amid inadequate availability of the US dollar.

Meanwhile, India's finance ministry has asked the Indian Banks’ Association (IBA) and the Federation of Indian Export Organisations (FIEO) to proceed with an awareness campaign to sensitise stakeholders about the rupee trade.&nbsp;

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India and Sri Lanka stepped up their talks to proceed with trade in Indian Rupee as New Delhi and Colombo look set to expand their bilateral cooperation in "power and energy sector as well as aspects relating to Rupee trade".

India and Sri Lanka stepped up their talks to proceed with trade in Indian Rupee as New Delhi and Colombo look set to expand their bilateral cooperation in "power and energy sector as well as aspects relating to Rupee trade". Dr Pramod Kumar Mishra, a cabinet rank official in India's Prime Minister Narendra Modi's administration, met with Sri Lankan High Commissioner Milinda Moragoda in New Delhi on Friday to continue the bilateral dialogue between two South Asian neighbours on a number of issues, including on debt restructuring matters crucial for Colombo's economic recovery. "The High Commissioner stressed the vital role that economic integration between the two countries could play in Sri Lanka's economic recovery," an official readout stated. "High Commissioner Moragoda also followed up [Pramod Kumar Mishra] on a range of issues pertaining to the bilateral relationship that had been discussed during their last meeting in February," the readout added, while referring to a previous round of bilateral talks between New Delhi and Colombo that addressed former's support for latter's economic recovery alongside aforementioned matters of bilateral cooperation. "The matters discussed included further economic integration between Sri Lanka and India, enhancing Indian investments and tourism in Sri Lanka, ways and means to further promote bilateral trade, cooperation in power and energy sector as well as aspects relating to Rupee trade," the official readout stated further. Several banks in Sri Lanka have opened special rupee trading accounts, called Vostro accounts. This means that Sri Lankan citizens can now hold $10,000 (₹8,26,823) in physical form and for transactions with their Indian counterparts, they can use Indian rupees instead of US dollars. ALSO READ | Sri Lanka to use Indian rupee for international trade, more countries aim to follow India's Prime Minister Narendra Modi's administration since July 2022, has been looking to bring countries that are short of dollars, into its rupee settlement mechanism. ALSO WATCH | Sri Lanka mull using Indian rupee for economic transactions × Designating Indian Rupee as a legal currency in Sri Lanka has provided India's coastal neighbour at its south much-needed liquidity support to help tide over its economic crisis amid inadequate availability of the US dollar. Meanwhile, India's finance ministry has asked the Indian Banks’ Association (IBA) and the Federation of Indian Export Organisations (FIEO) to proceed with an awareness campaign to sensitise stakeholders about the rupee trade. WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

India steps up rupee's internationalisation for Sri Lanka's economic recovery

Bangladesh will trade in Indian Rupees with India and has decided to avoid the US Dollar. De-Dollarisation is now on the climb globally. Is this the end to the Dollar empire? Molly Gambhir reports.

Gravitas : Bangladesh to trade in rupees with India

India and Malaysia have agreed to settle trade-related payments in Indian rupees, the New Delhi government has announced.

The Indian foreign ministry made the announcement on Saturday and follows the directive of the country’s central bank—the Reserve Bank of India—which has been pushing for the settlement of international trade in Indian currency.

The move comes in the wake of India making efforts to shift away from US dollars—the dominant reserve currency for international trade—as it has been appreciating against the local currency in the aftermath of the Russia-Ukraine war.

“Trade between India and Malaysia can now be settled in Indian Rupee (INR) in addition to the current modes of settlement in other currencies,” the Ministry of External Affairs said in a statement.

“This follows the decision by the Reserve Bank of India in July 2022 to allow the settlement of international trade in the Indian Rupee (INR). This initiative by RBI is aimed at facilitating the growth of global trade and to support the interests of the global trading community in Indian rupees.”

To facilitate settlement in Indian rupee, the Union Bank of India has opened a Special Rupee Vostro Account through its “corresponding bank” in Malaysia — India International Bank of Malaysia, based in Kuala Lumpur.

Vostro accounts are used to make payments in domestic currency.

In a separate statement, the India International Bank of Malaysia said, "IIBM now offers the facility to settle India-Malaysia bilateral trade in Indian Rupee (INR)...This new mechanism is also aligned with Malaysia's foreign exchange policies (FEP) as part of which Malaysian banks are allowed to undertake the settlement of international trade in goods or services in any foreign currency, subject to the rules and regulations of Bank Negara Malaysia."

"Under this facility, exporters and importers from India and Malaysia can now invoice the trade in Indian Rupee (INR) and achieve better pricing for goods and services traded. IIBM will facilitate the traders in Malaysia for settlement of this trade in Indian Rupee (INR). For this purpose, IIBM has opened a Special Rupee Vostro Account through its Corresponding Bank in India i.e. Union Bank of India," IIBM said.

Malaysia is the 27th largest investor in India with foreign direct investment of $ 300 million between April 2000 and June last year. The total FDI into India totalled around $ 298.8 million.

While the bilateral trade between both countries touched $13.86 billion in April-November 2022.

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India and Malaysia have agreed to settle trade-related payments in Indian rupees, the New Delhi government has announced. The Indian foreign ministry made the announcement on Saturday and follows the directive of the country’s central bank—the Reserve Bank of India—which has been pushing for the settlement of international trade in Indian currency.

India and Malaysia have agreed to settle trade-related payments in Indian rupees, the New Delhi government has announced. The Indian foreign ministry made the announcement on Saturday and follows the directive of the country’s central bank—the Reserve Bank of India—which has been pushing for the settlement of international trade in Indian currency. The move comes in the wake of India making efforts to shift away from US dollars—the dominant reserve currency for international trade—as it has been appreciating against the local currency in the aftermath of the Russia-Ukraine war. “Trade between India and Malaysia can now be settled in Indian Rupee (INR) in addition to the current modes of settlement in other currencies,” the Ministry of External Affairs said in a statement. “This follows the decision by the Reserve Bank of India in July 2022 to allow the settlement of international trade in the Indian Rupee (INR). This initiative by RBI is aimed at facilitating the growth of global trade and to support the interests of the global trading community in Indian rupees.” To facilitate settlement in Indian rupee, the Union Bank of India has opened a Special Rupee Vostro Account through its “corresponding bank” in Malaysia — India International Bank of Malaysia, based in Kuala Lumpur. Vostro accounts are used to make payments in domestic currency. In a separate statement, the India International Bank of Malaysia said, "IIBM now offers the facility to settle India-Malaysia bilateral trade in Indian Rupee (INR)...This new mechanism is also aligned with Malaysia's foreign exchange policies (FEP) as part of which Malaysian banks are allowed to undertake the settlement of international trade in goods or services in any foreign currency, subject to the rules and regulations of Bank Negara Malaysia." "Under this facility, exporters and importers from India and Malaysia can now invoice the trade in Indian Rupee (INR) and achieve better pricing for goods and services traded. IIBM will facilitate the traders in Malaysia for settlement of this trade in Indian Rupee (INR). For this purpose, IIBM has opened a Special Rupee Vostro Account through its Corresponding Bank in India i.e. Union Bank of India," IIBM said. Malaysia is the 27th largest investor in India with foreign direct investment of $ 300 million between April 2000 and June last year. The total FDI into India totalled around $ 298.8 million. While the bilateral trade between both countries touched $13.86 billion in April-November 2022. WATCH WION LIVE HERE

India and Malaysia dump dollar, to settle trade in Indian rupee

India and Sri Lanka are exploring the possibility of using the Indian rupee for economic transactions and have discussed the initiative that will help in building a stronger and closer partnership between the two countries.

Sri Lanka mull using Indian rupee for economic transactions

India and Sri Lanka are exploring the possibility of using the Indian rupee for economic transactions and have discussed the initiative that will help in building a stronger and closer partnership through trade and investment-led measures between the two countries.

The High Commission of India here organised a discussion on the use of the Indian Rupee (INR) for transactions between India and Sri Lanka on Thursday.

"Representatives from the Bank of Ceylon, State Bank of India and the Indian Bank shared their experiences and informed the audience that they had started carrying out INR-denominated trade transactions through respective Vostro/Nostro accounts after the creation of enabling framework by the Reserve Bank of India (RBI) and the Central Bank of Sri Lanka (CBSL) in 2022," the High Commission said in a statement.

Also read |&nbsp;<a href="https://www.wionews.com/world/sri-lanka-optimistic-of-imf-bailout-by-end-of-march-thanks-india-for-support-foreign-minister-ali-sabry-569027">Sri Lanka optimistic of IMF bailout by end of March, thanks India for support: Foreign Minister Ali Sabry</a>

The participating banks also outlined the benefits of settlements denominated in INR, which include shorter timelines, lower exchange costs and easier availability of trade credits.

The beneficial impact of this initiative on the tourism and hospitality industry was also highlighted including its role in helping increase collections which could be utilised by other sectors.

High Commissioner of India to Sri Lanka Gopal Baglay highlighted the positive impact that the initiative will have in the joint efforts for building a stronger and closer economic partnership between the two countries through trade and investment-led measures.

Sri Lanka's finance minister Shehan Semasinghe appreciated the close economic relationship between the two countries and the financial and humanitarian support extended by India over the past year, including the strong financing assurances provided by New Delhi, in the context of the IMF support programme for Sri Lanka. 
India extended assistance worth over USD 3.8 billion to Sri Lanka last year to help it deal with the economic crisis.

Governor of the CBSL, Dr P Nandalal Weerasinghe, highlighted the strong desire among Indian and Sri Lankan business communities for enabling trade settlements in INR.

He called for expanding this facility, over a period of time, to utilise it for the full range of capital and current account transactions. He also appreciated the wide-ranging participation from stakeholders in Sri Lanka and India which included more than 300 attendees in the physical format, apart from those that joined online, according to a report in The Island newspaper.

A team from RBI joined the discussion in the online format and indicated the possibility of settlement of current account transactions in goods, as well as services, in INR, apart from the option of undertaking permitted capital account transactions. The RBI team referred to the close cooperation with CBSL and RBI's commitment to further facilitate this process, it said.

Sri Lanka was hit by an unprecedented financial crisis in 2022, the worst since its independence from Britain in 1948, due to a severe paucity of foreign exchange reserves, sparking political turmoil in the country which led to the ouster of the all-powerful Rajapaksa family.

The IMF in September last year approved Sri Lanka a USD 2.9 billion bailout package over 4 years pending Sri Lanka's ability to restructure its debt with creditors - both bilateral and sovereign bondholders. With assurances from creditors, the USD 2.9 billion facilities could get the IMF board approval in March. 
&nbsp;

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India and Sri Lanka are exploring the possibility of using the Indian rupee for economic transactions and have discussed the initiative that will help in building a stronger and closer partnership through trade and investment-led measures between the two countries.

India and Sri Lanka are exploring the possibility of using the Indian rupee for economic transactions and have discussed the initiative that will help in building a stronger and closer partnership through trade and investment-led measures between the two countries. The High Commission of India here organised a discussion on the use of the Indian Rupee (INR) for transactions between India and Sri Lanka on Thursday. "Representatives from the Bank of Ceylon, State Bank of India and the Indian Bank shared their experiences and informed the audience that they had started carrying out INR-denominated trade transactions through respective Vostro/Nostro accounts after the creation of enabling framework by the Reserve Bank of India (RBI) and the Central Bank of Sri Lanka (CBSL) in 2022," the High Commission said in a statement. Also read | Sri Lanka optimistic of IMF bailout by end of March, thanks India for support: Foreign Minister Ali Sabry The participating banks also outlined the benefits of settlements denominated in INR, which include shorter timelines, lower exchange costs and easier availability of trade credits. The beneficial impact of this initiative on the tourism and hospitality industry was also highlighted including its role in helping increase collections which could be utilised by other sectors. High Commissioner of India to Sri Lanka Gopal Baglay highlighted the positive impact that the initiative will have in the joint efforts for building a stronger and closer economic partnership between the two countries through trade and investment-led measures. Sri Lanka's finance minister Shehan Semasinghe appreciated the close economic relationship between the two countries and the financial and humanitarian support extended by India over the past year, including the strong financing assurances provided by New Delhi, in the context of the IMF support programme for Sri Lanka. India extended assistance worth over USD 3.8 billion to Sri Lanka last year to help it deal with the economic crisis. Governor of the CBSL, Dr P Nandalal Weerasinghe, highlighted the strong desire among Indian and Sri Lankan business communities for enabling trade settlements in INR. He called for expanding this facility, over a period of time, to utilise it for the full range of capital and current account transactions. He also appreciated the wide-ranging participation from stakeholders in Sri Lanka and India which included more than 300 attendees in the physical format, apart from those that joined online, according to a report in The Island newspaper. A team from RBI joined the discussion in the online format and indicated the possibility of settlement of current account transactions in goods, as well as services, in INR, apart from the option of undertaking permitted capital account transactions. The RBI team referred to the close cooperation with CBSL and RBI's commitment to further facilitate this process, it said. Sri Lanka was hit by an unprecedented financial crisis in 2022, the worst since its independence from Britain in 1948, due to a severe paucity of foreign exchange reserves, sparking political turmoil in the country which led to the ouster of the all-powerful Rajapaksa family. The IMF in September last year approved Sri Lanka a USD 2.9 billion bailout package over 4 years pending Sri Lanka's ability to restructure its debt with creditors - both bilateral and sovereign bondholders. With assurances from creditors, the USD 2.9 billion facilities could get the IMF board approval in March. WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

India, Sri Lanka mull using Indian rupee for economic transactions

India is hopeful of a rupee trade with Russia. The government data showed a near 400% jump in Russian merchandise imports from April-December. Watch further to know more.

World Business Watch: Indian rupee's expanding ambition

Days after the Central Bank of Sri Lanka (CBSL) said that it was awaiting the Reserve Bank of India's (RBI) approval to designate Indian Rupee (INR) as a foreign currency in Sri Lanka, reports have emerged saying banks from India's neighbouring island nation have opened special rupee trading accounts, called Vostro accounts.&nbsp; 
 
Sri Lanka had requested the RBI to facilitate and promote trade and tourism in the SAARC region.&nbsp;

WATCH |&nbsp;<a href="https://www.wionews.com/videos/gravitas-india-pushes-for-trade-in-rupee-532702">Gravitas: India pushes for trade in rupee</a>

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&nbsp;

What does it mean?

It means that Sri Lankan citizens can now hold $10,000 (INR 8,26,823) in physical form. This also means that Sri Lankans and Indians can use Indian rupees instead of US dollars for international transactions with each other. The Indian government since July this year, has been looking to bring countries that are short of dollars, into its rupee settlement mechanism.

ALSO READ |&nbsp;<a href="https://www.wionews.com/business-economy/rupee-settlement-will-help-india-trade-with-russia-iran-and-south-asian-neighbours-experts-496677">Rupee settlement will help India trade with Russia, Iran and S Asian neighbours</a>&nbsp;

Special rupee accounts for international transactions between designated countries are called Vostro accounts.&nbsp;

Why Sri Lanka is keen to trade in INR?

This is because designating INR as a legal currency in Sri Lanka will provide the country with much-needed liquidity support to help it tide over its economic crisis amid inadequate availability of the US dollar.&nbsp;

With a foreign currency (in Sri Lanka's case the INR), the country's economy is more likely to prevent further intensification of the balance of payments crisis when the investors begin selling off in domestic currency.

India's efforts for Rupee's internationalisation?

So far, India's central bank has given approval to banks to open 12 Vostro accounts for trade in rupees with Russia. Six other accounts, including five for trade with Sri Lanka and one for trade with Mauritius, have also been authorised, a Reserve Bank of India document cited by Economic Times showed. Countries such as Tajikistan, Cuba, Luxembourg and Sudan, too, reportedly are in talks about using the rupee settlement mechanism.&nbsp;

India's finance ministry has also asked the Indian Banks’ Association (IBA) and the Federation of Indian Export Organisations (FIEO) to begin an awareness campaign to sensitise stakeholders about the rupee trade.&nbsp;

The Reserve Bank of India in July had notified the new mechanism for settling international trade in the rupee. This was aimed at not just reducing the rupee against the dollar but also internationalising the Indian currency.

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Days after the Central Bank of Sri Lanka (CBSL) said that it was awaiting the Reserve Bank of India's (RBI) approval to designate Indian Rupee (INR) as a foreign currency in Sri Lanka, reports have emerged saying banks from India's neighbouring island nation have opened special rupee trading accounts, called Vostro accounts.

Days after the Central Bank of Sri Lanka (CBSL) said that it was awaiting the Reserve Bank of India's (RBI) approval to designate Indian Rupee (INR) as a foreign currency in Sri Lanka, reports have emerged saying banks from India's neighbouring island nation have opened special rupee trading accounts, called Vostro accounts. Sri Lanka had requested the RBI to facilitate and promote trade and tourism in the SAARC region. WATCH | Gravitas: India pushes for trade in rupee × What does it mean? It means that Sri Lankan citizens can now hold $10,000 (INR 8,26,823) in physical form. This also means that Sri Lankans and Indians can use Indian rupees instead of US dollars for international transactions with each other. The Indian government since July this year, has been looking to bring countries that are short of dollars, into its rupee settlement mechanism. ALSO READ | Rupee settlement will help India trade with Russia, Iran and S Asian neighbours Special rupee accounts for international transactions between designated countries are called Vostro accounts. Why Sri Lanka is keen to trade in INR? This is because designating INR as a legal currency in Sri Lanka will provide the country with much-needed liquidity support to help it tide over its economic crisis amid inadequate availability of the US dollar. With a foreign currency (in Sri Lanka's case the INR), the country's economy is more likely to prevent further intensification of the balance of payments crisis when the investors begin selling off in domestic currency. India's efforts for Rupee's internationalisation? So far, India's central bank has given approval to banks to open 12 Vostro accounts for trade in rupees with Russia. Six other accounts, including five for trade with Sri Lanka and one for trade with Mauritius, have also been authorised, a Reserve Bank of India document cited by Economic Times showed. Countries such as Tajikistan, Cuba, Luxembourg and Sudan, too, reportedly are in talks about using the rupee settlement mechanism. India's finance ministry has also asked the Indian Banks’ Association (IBA) and the Federation of Indian Export Organisations (FIEO) to begin an awareness campaign to sensitise stakeholders about the rupee trade. The Reserve Bank of India in July had notified the new mechanism for settling international trade in the rupee. This was aimed at not just reducing the rupee against the dollar but also internationalising the Indian currency. WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

Sri Lanka to use Indian rupee for international trade, more countries aim to follow

Who decides the value of your currency? Why is it that one day the value of Rupee rises and the next day it falls again? Why is the value of Rupee dependent on U.S. Dollar? Molly Gambhir tells you.

Gravitas Plus: Who decides the value of your currency? Find out

The Indian rupee dropped by 71 paise during intraday trade to hit the all-time&nbsp;low of 83 against the United States dollar on Wednesday. It followed the trend of the US dollar strengthening its position against most major currencies, including the pound in the United Kingdom.

While the previous all-time low was 82.63, the rupee dipped to record low of 83.22.

Also read |&nbsp;<a href="https://www.wionews.com/world/iranian-trainers-reportedly-teaching-russian-military-about-drones-in-crimea-526668">Iranian trainers reportedly teaching Russian military about drones in Crimea</a>

According to Financial Times, experts were taken by surprise following the sudden drop and the trading on Thursday will be crucial to determine the future trend of the Indian rupee.

The impact of the rupee was also felt in the Indian stock market as the Sensex and Nifty 50 – two major indicators – fell considerably and closed the market with substantial losses on Wednesday.

The main reasons behind this sudden drop in the rupee’s value are the mounting recession fears brought about the ongoing Ukraine-Russia war. Currencies like the Euro, Pound and the Yen have all lost their value in the last month and Reuters had reported that the rupee can fall below the 83-mark.

Also read |&nbsp;<a href="https://www.wionews.com/world/uk-inflation-accelerates-to-40-year-high-amid-rising-food-prices-526733">UK inflation accelerates to 40-year high amid rising food prices</a>

Earlier in the day, the Office for National Statistics in the United Kingdom said that the inflation was at its all-time high since 1982. The index rose from 9.9 per cent in September to 10.1 per cent.

On the other hand, the Japanese Yen is also experiencing a 32-year low against the US dollar. The USD is boosted by the measures taken by the US Federal Reserve and that has directly affected the other currencies.

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The Indian rupee dropped by 71 paise during intraday trade to hit the all-time low of 83 against the United States dollar on Wednesday. It followed the trend of the US dollar strengthening its position against most major currencies, including the pound in the United Kingdom.

The Indian rupee dropped by 71 paise during intraday trade to hit the all-time low of 83 against the United States dollar on Wednesday. It followed the trend of the US dollar strengthening its position against most major currencies, including the pound in the United Kingdom. While the previous all-time low was 82.63, the rupee dipped to record low of 83.22. Also read | Iranian trainers reportedly teaching Russian military about drones in Crimea According to Financial Times, experts were taken by surprise following the sudden drop and the trading on Thursday will be crucial to determine the future trend of the Indian rupee. The impact of the rupee was also felt in the Indian stock market as the Sensex and Nifty 50 – two major indicators – fell considerably and closed the market with substantial losses on Wednesday. The main reasons behind this sudden drop in the rupee’s value are the mounting recession fears brought about the ongoing Ukraine-Russia war. Currencies like the Euro, Pound and the Yen have all lost their value in the last month and Reuters had reported that the rupee can fall below the 83-mark. Also read | UK inflation accelerates to 40-year high amid rising food prices Earlier in the day, the Office for National Statistics in the United Kingdom said that the inflation was at its all-time high since 1982. The index rose from 9.9 per cent in September to 10.1 per cent. On the other hand, the Japanese Yen is also experiencing a 32-year low against the US dollar. The USD is boosted by the measures taken by the US Federal Reserve and that has directly affected the other currencies.

Indian rupee falls to record low against United States dollar, crosses 83-mark

The Rupee plunged below the 82 mark for the first time against the US dollar on 29 September. By 10 October, the Rupee further slid downhill to 82.75. The currency had been on a fast-paced downslide over the recent months along with its Asian peers. Various factors have contributed to currency instability when the world is staring at a looming economic uncertainty.

War and the crude prices

The hike and volatility in crude prices caused due to the war in <a href="https://www.wionews.com/world/ukraine-conflict-has-pushed-4-million-children-into-poverty-unicef-525952">Ukraine</a> has significantly moved up India’s import costs, thereby creating more demand for the US dollar. The pent-up demand after the COVID-19 crisis has not been met with sufficient supplies. The<a href="https://www.wionews.com/world/will-never-renounce-force-says-xi-jinping-on-taiwan-during-the-party-congress-525795"> zero-Covid strategy in China </a>had greatly subdued its manufacturing potential, leaving the world short of adequate supplies.&nbsp;

The disruption of COVID-19 had lent a big blow to the global supply chains, unsettling global and regional connectivity. The sanctions on Russian crude and natural gas have critically affected many European countries. The supply-side constraints have been the major factor behind the high inflation rates reported by chief economies of the world.&nbsp;

Fears of recession

So far, India has fared better than the US and other western economies. The <a href="https://www.wionews.com/world/uk-pm-liz-truss-economic-plan-was-a-mistake-says-biden-525756">inflation</a> rate in India is hovering around 7 per cent&nbsp;which is still in the manageable spectrum. The US and many European countries consistently report inflation rates of over 8 per cent&nbsp;which is way over the norms of advanced economies.

The continuing hawkish stance of the Federal Reserve is further bolstering fears of recession. The climate of creeping instability is forcing all the money to be parked in safe havens like the US dollar as a hedge against potential risks. Foreign Institutional Investors (FIIs) had been net sellers in the Indian Stock Market during September.&nbsp;

Yuan depreciation in recent months has made Chinese imports much more attractive that further led to the lowering of demand for the Indian Rupee. Aggregately, prevailing economic conditions are causing widening of the Current Account Deficit (CAD) of the country. As per the latest data from RBI, the CAD increased from 1.5 per cent&nbsp;of the GDP in the January-March quarter to 2.8 per cent&nbsp;of the GDP in the April-June quarter.&nbsp;

The Reserve Bank of <a href="https://www.wionews.com/india-news/indian-man-wrongly-detained-at-abu-dhabi-airport-over-mistaken-identity-lands-in-delhi-525936">India</a> (RBI), India’s central bank, sold its Foreign Exchange Reserves (Forex) aggressively from July to prevent the Rupee from crossing the psychological mark of 80. India’s Forex dropped to $537.5 billion by 23 September, the lowest level since August 2020.

The Rupee settlement system 

The RBI for a long time has been deliberating on ways to reduce dependence on the US dollar and tide over <a href="https://www.wionews.com/world/brazil-bolsonaro-lula-face-off-in-first-debate-525954">US</a> sanctions in various parts of the globe. In July, the RBI permitted international trade to be invoiced, denominated, and settled in Indian Rupee. Market forces would determine the rate of exchange of trade. Touted as an early step toward internationalization of the Indian Rupee, it remains to be seen how the step will play out in the long term.

Deputy Governor of the RBI said on 30 September&nbsp;that around five countries have responded positively to its plan to settle international trade in Rupees, but the process involves technicalities at the level of banks and is going to take some time.&nbsp;

If implemented in the long term, the mechanism would reduce the over-dependence on the US dollar and save precious Forex reserves. In the near future, major benefits could be reaped in trade with Russia and Iran, where the US sanctions have made the trade in US dollars almost an impossibility. Countries with an export surplus with India might not be largely enthusiastic straightaway, because they will have no use for excess Rupee unless it has achieved widespread international acceptance.

Inclusion in Global bond indices

India’s efforts to get included in the Global bond indices is another step by the<a href="https://www.wionews.com/world/iran-protests-raisi-accuses-biden-of-inciting-chaos-in-the-country-525946"> government</a> that could alter the currency status-quo. The RBI is working closely with the government to enable international settlement of government securities and incorporation of rupee-denominated bonds in Global bond indices.&nbsp;

Russia’s recent exclusion from the JP Morgan government bond index-emerging markets (GBI-EM) has left the index unbalanced boosting India’s chances of inclusion. Morgan Stanley, a leading brokerage firm said that the inclusion could attract $170 billion to $250 billion to India in foreign inflows over the next decade. The firm also expects the Rupee to appreciate by 2 per cent every year in REER (Real Effective Exchange Rate) terms, in addition to creating a better investment climate.

JP Morgan GBI-EM and FTSE Russell—two Global bond indices have already put India on the watch list for possible inclusion. Major hindrances that need to be removed before inclusion are India’s local bond settlement rules and tax hurdles. In September, GBI-EM deferred inclusion of Indian government bonds till early next year. The government is not yet willing to exempt foreign investors from capital gains tax because it would discriminate against domestic investors.

Pilot launch of India’s digital currency

On 7 October, the RBI released a concept note on the proposed <a href="https://www.wionews.com/world/bitcoin-firm-nydig-laid-off-about-a-third-of-staff-in-september-reports-say-525289">digital</a> Rupee. One of its stated objectives is the improvement in cross-border transactions. India is wary of the rapidly expanding Chinese CDBC (Central bank digital currency) project and fears being left behind if digital Yuan increases its stature as a global currency. India feels it has to set the ball rolling, to gain a fair share of future global transactions, denominated in Rupee. 

Gradual depreciation of the Rupee may be good for boosting India’s exports. Nevertheless, it is imperative to prevent drastic falls and preserve currency stability. Inclusion in Global bond indices would cater well for Rupee stability because it allows for parking of global passive funds in Indian markets. Expanding the horizons of Rupee will increase its worldwide acceptance and builds trust. Precisely the reason why the national government is bent on internationalization of the Rupee, even if it shrinks the fiscal space of the government.

WATCH WION LIVE HERE:&nbsp;

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The Rupee plunged below the 82 mark for the first time against the US dollar on 29 September. By 10 October, the Rupee further slid downhill to 82.75. The currency had been on a fast-paced downslide over the recent months along with its Asian peers.

The Rupee plunged below the 82 mark for the first time against the US dollar on 29 September. By 10 October, the Rupee further slid downhill to 82.75. The currency had been on a fast-paced downslide over the recent months along with its Asian peers. Various factors have contributed to currency instability when the world is staring at a looming economic uncertainty. War and the crude prices The hike and volatility in crude prices caused due to the war in Ukraine has significantly moved up India’s import costs, thereby creating more demand for the US dollar. The pent-up demand after the COVID-19 crisis has not been met with sufficient supplies. The zero-Covid strategy in China had greatly subdued its manufacturing potential, leaving the world short of adequate supplies. The disruption of COVID-19 had lent a big blow to the global supply chains, unsettling global and regional connectivity. The sanctions on Russian crude and natural gas have critically affected many European countries. The supply-side constraints have been the major factor behind the high inflation rates reported by chief economies of the world. Fears of recession So far, India has fared better than the US and other western economies. The inflation rate in India is hovering around 7 per cent which is still in the manageable spectrum. The US and many European countries consistently report inflation rates of over 8 per cent which is way over the norms of advanced economies. The continuing hawkish stance of the Federal Reserve is further bolstering fears of recession. The climate of creeping instability is forcing all the money to be parked in safe havens like the US dollar as a hedge against potential risks. Foreign Institutional Investors (FIIs) had been net sellers in the Indian Stock Market during September. Yuan depreciation in recent months has made Chinese imports much more attractive that further led to the lowering of demand for the Indian Rupee. Aggregately, prevailing economic conditions are causing widening of the Current Account Deficit (CAD) of the country. As per the latest data from RBI, the CAD increased from 1.5 per cent of the GDP in the January-March quarter to 2.8 per cent of the GDP in the April-June quarter. The Reserve Bank of India (RBI), India’s central bank, sold its Foreign Exchange Reserves (Forex) aggressively from July to prevent the Rupee from crossing the psychological mark of 80. India’s Forex dropped to $537.5 billion by 23 September, the lowest level since August 2020. The Rupee settlement system The RBI for a long time has been deliberating on ways to reduce dependence on the US dollar and tide over US sanctions in various parts of the globe. In July, the RBI permitted international trade to be invoiced, denominated, and settled in Indian Rupee. Market forces would determine the rate of exchange of trade. Touted as an early step toward internationalization of the Indian Rupee, it remains to be seen how the step will play out in the long term. Deputy Governor of the RBI said on 30 September that around five countries have responded positively to its plan to settle international trade in Rupees, but the process involves technicalities at the level of banks and is going to take some time. If implemented in the long term, the mechanism would reduce the over-dependence on the US dollar and save precious Forex reserves. In the near future, major benefits could be reaped in trade with Russia and Iran, where the US sanctions have made the trade in US dollars almost an impossibility. Countries with an export surplus with India might not be largely enthusiastic straightaway, because they will have no use for excess Rupee unless it has achieved widespread international acceptance. Inclusion in Global bond indices India’s efforts to get included in the Global bond indices is another step by the government that could alter the currency status-quo. The RBI is working closely with the government to enable international settlement of government securities and incorporation of rupee-denominated bonds in Global bond indices. Russia’s recent exclusion from the JP Morgan government bond index-emerging markets (GBI-EM) has left the index unbalanced boosting India’s chances of inclusion. Morgan Stanley, a leading brokerage firm said that the inclusion could attract $170 billion to $250 billion to India in foreign inflows over the next decade. The firm also expects the Rupee to appreciate by 2 per cent every year in REER (Real Effective Exchange Rate) terms, in addition to creating a better investment climate. JP Morgan GBI-EM and FTSE Russell—two Global bond indices have already put India on the watch list for possible inclusion. Major hindrances that need to be removed before inclusion are India’s local bond settlement rules and tax hurdles. In September, GBI-EM deferred inclusion of Indian government bonds till early next year. The government is not yet willing to exempt foreign investors from capital gains tax because it would discriminate against domestic investors. Pilot launch of India’s digital currency On 7 October, the RBI released a concept note on the proposed digital Rupee. One of its stated objectives is the improvement in cross-border transactions. India is wary of the rapidly expanding Chinese CDBC (Central bank digital currency) project and fears being left behind if digital Yuan increases its stature as a global currency. India feels it has to set the ball rolling, to gain a fair share of future global transactions, denominated in Rupee. Gradual depreciation of the Rupee may be good for boosting India’s exports. Nevertheless, it is imperative to prevent drastic falls and preserve currency stability. Inclusion in Global bond indices would cater well for Rupee stability because it allows for parking of global passive funds in Indian markets. Expanding the horizons of Rupee will increase its worldwide acceptance and builds trust. Precisely the reason why the national government is bent on internationalization of the Rupee, even if it shrinks the fiscal space of the government. WATCH WION LIVE HERE:

India: Depreciation pushes RBI to internationalise the Rupee

The rupee depreciated 44 paise and slipped below the 81-mark against the US dollar for the first time ever in early trade on Friday, weighed down by the strong American currency and risk-off sentiment among investors.&nbsp;

Forex traders said escalation of geopolitical risk in&nbsp;Ukraine&nbsp;and rate hikes by the US&nbsp;Fed&nbsp;and Bank of&nbsp;England&nbsp;in a bid to contain&nbsp;inflation&nbsp;sapped risk appetite.&nbsp;

Further, the strength of the American currency in the overseas market, a negative trend in domestic equities, and risk-off moods amid escalation of geopolitical risk in Ukraine weighed on the local unit.&nbsp;

At the interbank foreign exchange, the rupee opened at 81.08 against the greenback, then fell further to 81.23, registering a fall of 44 paise over its previous closing.&nbsp;

Also read |&nbsp;<a href="https://www.wionews.com/world/indian-external-affairs-minister-s-jaishankar-attends-brics-ministerial-meet-on-sidelines-of-unga-518899" hreflang="en">Indian External Affairs Minister S Jaishankar attends BRICS ministerial meet on sidelines of UNGA</a>

On Thursday, the rupee plunged by 83 paise — its biggest single-day loss in nearly seven months — to close at an all-time low of 80.79 against the US dollar.&nbsp;

The&nbsp;Bank of England hiked&nbsp;its base rate by 50 basis points (bps) to a 14-year high of 2.25 per cent.&nbsp;

The Bank of Japan intervened in the FX market for the&nbsp;first time in 24 years&nbsp;to stem a falling Yen after it kept rates at record lows, IFA Global Research Academy said, adding that the Swiss National Bank hiked rates by a record 75 bps to 0.5 per cent.&nbsp;

The US Fed has hiked interest rates by 75 basis points to 3-3.25 per cent.&nbsp;

Also read |&nbsp;<a href="https://www.wionews.com/south-asia/un-memo-says-pakistan-should-suspend-debt-repayments-following-devastating-floods-reports-518889">UN memo says Pakistan should suspend debt repayments: Reports</a>

On Thursday, RBI was conspicuous by its absence from the spot market as the rupee fell by 1 per cent possibly as it wanted the rupee to do the catching up, said Anil Kumar Bhansali, head of rreasury, Finrex Treasury Advisors.&nbsp;

“All major events are over for this month as we await RBI’s MPC to give its verdict on September 30, 2022,” Bhansali added.&nbsp;

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, advanced 0.05 per cent to 111.41.&nbsp;

Global oil benchmark Brent crude futures fell 0.57 per cent to USD 89.94 per barrel.&nbsp;

On the domestic equity market front, the 30-share&nbsp;BSE Sensex was trading&nbsp;558.59 points or 0.94 per cent down at 58,561.13, while the broader NSE Nifty fell 153.10 points or 0.87 per cent to 17,476.70.&nbsp;

Foreign institutional investors were net sellers in the capital market on Thursday as they offloaded shares worth Rs 2,509.55 crore, as per exchange data.&nbsp;

The rupee depreciated 44 paise and slipped below the 81-mark against the US dollar for the first time ever in early trade on Friday, weighed down by the strong American currency and risk-off sentiment among investors.

The rupee depreciated 44 paise and slipped below the 81-mark against the US dollar for the first time ever in early trade on Friday, weighed down by the strong American currency and risk-off sentiment among investors. Forex traders said escalation of geopolitical risk in Ukraine and rate hikes by the US Fed and Bank of England in a bid to contain inflation sapped risk appetite. Further, the strength of the American currency in the overseas market, a negative trend in domestic equities, and risk-off moods amid escalation of geopolitical risk in Ukraine weighed on the local unit. At the interbank foreign exchange, the rupee opened at 81.08 against the greenback, then fell further to 81.23, registering a fall of 44 paise over its previous closing. Also read | Indian External Affairs Minister S Jaishankar attends BRICS ministerial meet on sidelines of UNGA On Thursday, the rupee plunged by 83 paise — its biggest single-day loss in nearly seven months — to close at an all-time low of 80.79 against the US dollar. The Bank of England hiked its base rate by 50 basis points (bps) to a 14-year high of 2.25 per cent. The Bank of Japan intervened in the FX market for the first time in 24 years to stem a falling Yen after it kept rates at record lows, IFA Global Research Academy said, adding that the Swiss National Bank hiked rates by a record 75 bps to 0.5 per cent. The US Fed has hiked interest rates by 75 basis points to 3-3.25 per cent. Also read | UN memo says Pakistan should suspend debt repayments: Reports On Thursday, RBI was conspicuous by its absence from the spot market as the rupee fell by 1 per cent possibly as it wanted the rupee to do the catching up, said Anil Kumar Bhansali, head of rreasury, Finrex Treasury Advisors. “All major events are over for this month as we await RBI’s MPC to give its verdict on September 30, 2022,” Bhansali added. Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, advanced 0.05 per cent to 111.41. Global oil benchmark Brent crude futures fell 0.57 per cent to USD 89.94 per barrel. On the domestic equity market front, the 30-share BSE Sensex was trading 558.59 points or 0.94 per cent down at 58,561.13, while the broader NSE Nifty fell 153.10 points or 0.87 per cent to 17,476.70. Foreign institutional investors were net sellers in the capital market on Thursday as they offloaded shares worth Rs 2,509.55 crore, as per exchange data.

Indian rupee hits new low, slips below 81-mark against US dollar for the first time ever

The Indian rupee firmed ahead of a central bank monetary policy decision on Friday, supported by overnight weakness in oil prices and the dollar.

Indian rupee strengthens ahead of RBI decision

The Indian rupee hit 80 per dollar on Tuesday (July 19), for the first time ever, yet another record low, as international investors kept offloading the Indian stocks. The rupee fell to 80.06 against the dollar. The currency has been impacted by the nation’s record high foreign equity outflows of about $30 billion so far this year, now worrying about a widening current account deficit in the face of high oil and commodities prices. The Indian policymakers have taken various steps to stop the rupee’s slide such as from intervention to hiking import taxes on gold, Bloomberg reported.&nbsp;

As per Governor Shaktikanta Das, the Indian central bank is intervening in all market segments to reduce the risk and support a currency’s orderly appreciation or depreciation. However, the Indian rupee touched a record low for the seventh straight session on Tuesday, Reuters reported.&nbsp;

Also read | <a href="https://www.wionews.com/india-news/india-is-set-it-on-course-to-becoming-the-fastest-growing-economy-in-the-world-rbi-498137">India is 'on course to becoming the fastest growing economy in the world': RBI</a>

The RBI has been using its $600 billion in foreign exchange reserves to defend the Indian rupee. Additionally, the monetary authorities enabled trade to be settled in rupees and announced initiatives to increase the foreign currency inflows into the nation.&nbsp;

However, Tuesday saw a decline in oil prices as the dollar fueled purchasing demand. As the West sanctions in Russia, the supplies have disrupted trade flows to refiners and have been a thorn on the side of the oil markets. At the same time, there have been growing concerns that the central bank's efforts to tame surging inflation may lead to recession, which would reduce future fuel demand. Despite the decline in oil prices, several banks were already charging 80 rupees for every dollar in the exchange rate, the State Bank of India said.&nbsp;

Also read |&nbsp;<a href="https://www.wionews.com/business-economy/indian-rupee-set-to-depreciate-further-all-set-to-breach-80-per-us-dollar-497209">Indian rupee set to depreciate further, to breach 80 per US dollar</a>

However, it is expected that the&nbsp;rupee might fall to 82 to the dollar by September this year, according to strategists at Nomura holdings Inc. and Morgan Stanley, Bloomberg reported.&nbsp;

The rupee has been reported to reach fresh record lows practically every other day in recent months, and traders believe this trend will continue.&nbsp;

(With inputs from agencies)

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The Indian rupee hit 80 per dollar on Tuesday (July 19), for the first time ever, yet another record low, as international investors kept offloading the Indian stocks.

The Indian rupee hit 80 per dollar on Tuesday (July 19), for the first time ever, yet another record low, as international investors kept offloading the Indian stocks. The rupee fell to 80.06 against the dollar. The currency has been impacted by the nation’s record high foreign equity outflows of about $30 billion so far this year, now worrying about a widening current account deficit in the face of high oil and commodities prices. The Indian policymakers have taken various steps to stop the rupee’s slide such as from intervention to hiking import taxes on gold, Bloomberg reported. As per Governor Shaktikanta Das, the Indian central bank is intervening in all market segments to reduce the risk and support a currency’s orderly appreciation or depreciation. However, the Indian rupee touched a record low for the seventh straight session on Tuesday, Reuters reported. Also read | India is 'on course to becoming the fastest growing economy in the world': RBI The RBI has been using its $600 billion in foreign exchange reserves to defend the Indian rupee. Additionally, the monetary authorities enabled trade to be settled in rupees and announced initiatives to increase the foreign currency inflows into the nation. However, Tuesday saw a decline in oil prices as the dollar fueled purchasing demand. As the West sanctions in Russia, the supplies have disrupted trade flows to refiners and have been a thorn on the side of the oil markets. At the same time, there have been growing concerns that the central bank's efforts to tame surging inflation may lead to recession, which would reduce future fuel demand. Despite the decline in oil prices, several banks were already charging 80 rupees for every dollar in the exchange rate, the State Bank of India said. Also read | Indian rupee set to depreciate further, to breach 80 per US dollar However, it is expected that the rupee might fall to 82 to the dollar by September this year, according to strategists at Nomura holdings Inc. and Morgan Stanley, Bloomberg reported. The rupee has been reported to reach fresh record lows practically every other day in recent months, and traders believe this trend will continue. (With inputs from agencies) WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

Indian rupee hits low of 80 per dollar for the first time ever

The Indian rupee breached 80 against the US dollar amid expectations of an aggressive rate hike by the US Federal Reserve. What explains the rupee's rapid depreciation? What does it mean for the average Indian citizen? Palki Sharma tells you.

Gravitas: Rupee's historic plunge, breaches 80 against dollar

With the Indian rupee plunging to historic lows against the dollar, analysts have predicted that the local currency is all set to touch the 80-rupee barrier against the US currency.

For the past four to five days, the Indian currency has been facing severe blowbacks as foreign institutional investors have continued to dump Indian equities in search of safe haven US dollars, putting further pressure on the local currency.

At the start of the year, the rupee-dollar exchange rate was at 74. But recession fears, the Russian invasion of Ukraine and the resultant spike in oil and gas prices have put tremendous pressure on the rupee.

According to Bloomberg data, the currency has slumped to a new record low level 26 times since Russia invaded Ukraine late in February.

On Thursday, the local currency opened trading at a lifetime low of 79.71 (provisional) per US dollar compared to its previous close of 79.63.

Analysts believe that the rupee-dollar exchange rate will most certainly touch 80 as the experts expect the United States Federal Reserve to hike the interest rates by another 75 to 100 basis points at the end of the month to tackle hot inflation. This will further trigger the outflow of dollars from India and back to the US.

“Rupee is expected to depreciate today (Thursday) amid strong dollar and risk aversion in global markets. Market sentiments are hurt as red hot inflation in the US stoked bets that the US Fed may have to raise interest rates much more than expected, even 100 bps. Additionally, consistent FII outflows and concerns on looming recession may hurt rupee. US$INR (July) is expected to trade in a range of 79.50-80.00," said ICICI Direct in a statement.

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With the Indian rupee plunging to historic lows against the dollar, analysts have predicted that the local currency is all set to touch the 80-rupee barrier against the US currency.

With the Indian rupee plunging to historic lows against the dollar, analysts have predicted that the local currency is all set to touch the 80-rupee barrier against the US currency. For the past four to five days, the Indian currency has been facing severe blowbacks as foreign institutional investors have continued to dump Indian equities in search of safe haven US dollars, putting further pressure on the local currency. At the start of the year, the rupee-dollar exchange rate was at 74. But recession fears, the Russian invasion of Ukraine and the resultant spike in oil and gas prices have put tremendous pressure on the rupee. According to Bloomberg data, the currency has slumped to a new record low level 26 times since Russia invaded Ukraine late in February. On Thursday, the local currency opened trading at a lifetime low of 79.71 (provisional) per US dollar compared to its previous close of 79.63. Analysts believe that the rupee-dollar exchange rate will most certainly touch 80 as the experts expect the United States Federal Reserve to hike the interest rates by another 75 to 100 basis points at the end of the month to tackle hot inflation. This will further trigger the outflow of dollars from India and back to the US. “Rupee is expected to depreciate today (Thursday) amid strong dollar and risk aversion in global markets. Market sentiments are hurt as red hot inflation in the US stoked bets that the US Fed may have to raise interest rates much more than expected, even 100 bps. Additionally, consistent FII outflows and concerns on looming recession may hurt rupee. US$INR (July) is expected to trade in a range of 79.50-80.00," said ICICI Direct in a statement. WATCH WION LIVE HERE

Indian rupee set to depreciate further, to breach 80 per US dollar

The Reserve Bank of India has rolled out a system to settle international trade transactions in the Indian rupee instead of the dollar. How does the rupee trade work? How will it impact India's trade relations? Palki Sharma tells you.

Gravitas: RBI announces rupee mechanism for foreign trade

The&nbsp;Indian central bank's decision to let importers pay with&nbsp;rupees&nbsp;and&nbsp;exporters be paid in&nbsp;rupees is likely to make&nbsp;trade&nbsp;easier with&nbsp;Russia&nbsp;and&nbsp;South Asian&nbsp;neighbours,&nbsp;and&nbsp;will&nbsp;help&nbsp;a long term goal to internationalise the currency,&nbsp;experts&nbsp;said.

On Monday, the Reserve Bank of&nbsp;India&nbsp;said it had put in place a mechanism for international&nbsp;trade&nbsp;settlements in&nbsp;Indian&nbsp;rupees (INR) with immediate effect.

Also read |&nbsp;<a href="https://www.wionews.com/india-news/rupee-hits-all-time-low-of-789-against-dollar-80-level-at-sight-492813">Rupee hits all-time low of 78.9 against dollar; 80-level at sight</a>

The RBI said that "in order to promote growth of global&nbsp;trade&nbsp;with emphasis on exports from&nbsp;India&nbsp;and&nbsp;to support the increasing interest of global trading community in INR, it has been decided to put in place an additional arrangement for invoicing, payment,&nbsp;and&nbsp;settlement&nbsp;of exports/imports in INR."

"This step can be particularly useful for neighbouring countries,&nbsp;and&nbsp;also those countries willing to use the&nbsp;rupee&nbsp;as a base currency for&nbsp;trade&nbsp;diversification in their&nbsp;settlement&nbsp;rules," said Rahul Bajoria, chief&nbsp;India&nbsp;economist at Barclays.

Watch |&nbsp;RBI allows payment for International trade in Rupee

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Engineering Export Promotion Council chairman Mahesh Desai noted the new mechanism "would facilitate&nbsp;trade&nbsp;with countries under sanctions, like&nbsp;Iran&nbsp;and&nbsp;Russia."

Trade&nbsp;between&nbsp;India&nbsp;and&nbsp;Russia&nbsp;has come to a virtual standstill due to sanctions imposed on&nbsp;Russia&nbsp;over the war in Ukraine.

Also read |&nbsp;<a href="https://www.wionews.com/business-economy/indian-rupee-slides-to-record-low-of-7782-against-us-dollar-486849">Indian rupee slides to record low of 77.82 against US dollar</a>

The new steps allow&nbsp;Indian exporters&nbsp;and&nbsp;importers to use special&nbsp;Rupee&nbsp;Vostro Accounts to settle&nbsp;trade&nbsp;denominated in&nbsp;rupees,&nbsp;and&nbsp;banks will need the RBI's approval to use the&nbsp;settlement&nbsp;system.

"We see this as a first step towards 100 per cent&nbsp;convertibility of&nbsp;rupee," Desai said, noting it would also reduce currency fluctuation risks for importers&nbsp;and&nbsp;exporters.

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The Indian central bank's decision to let importers pay with rupees and exporters be paid in rupees is likely to make trade easier with Russia and South Asian neighbours, and will help a long term goal to internationalise the currency, experts said.

The Indian central bank's decision to let importers pay with rupees and exporters be paid in rupees is likely to make trade easier with Russia and South Asian neighbours, and will help a long term goal to internationalise the currency, experts said. On Monday, the Reserve Bank of India said it had put in place a mechanism for international trade settlements in Indian rupees (INR) with immediate effect. Also read | Rupee hits all-time low of 78.9 against dollar; 80-level at sight The RBI said that "in order to promote growth of global trade with emphasis on exports from India and to support the increasing interest of global trading community in INR, it has been decided to put in place an additional arrangement for invoicing, payment, and settlement of exports/imports in INR." "This step can be particularly useful for neighbouring countries, and also those countries willing to use the rupee as a base currency for trade diversification in their settlement rules," said Rahul Bajoria, chief India economist at Barclays. Watch | RBI allows payment for International trade in Rupee Engineering Export Promotion Council chairman Mahesh Desai noted the new mechanism "would facilitate trade with countries under sanctions, like Iran and Russia." Trade between India and Russia has come to a virtual standstill due to sanctions imposed on Russia over the war in Ukraine. Also read | Indian rupee slides to record low of 77.82 against US dollar The new steps allow Indian exporters and importers to use special Rupee Vostro Accounts to settle trade denominated in rupees, and banks will need the RBI's approval to use the settlement system. "We see this as a first step towards 100 per cent convertibility of rupee," Desai said, noting it would also reduce currency fluctuation risks for importers and exporters. WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

Rupee settlement will help India trade with Russia, Iran and S Asian neighbours - experts

The increasing global crude oil prices and inflation concerns turned slippery for the Indian rupee as it went down against the US dollar on Tuesday. 
 
Further, foreign investors (FII) continued to sell their equity holdings on the bourses. 
 
The Indian rupee opened at Rs 78.50 and went down to touch a fresh record low of 78.68 against the dollar. 
 
As crude prices increase, the rupee may further slip down, analysts said. 
 
The Reserve Bank of India (RBI) intervened by selling dollars to stabilise the rupee rate but the demand for the US currency was high. 
 
According to a report by Emkay Global Financial Services Ltd, a total of $34 billion (FII equities and FII debt) has flown out of India during the last eight months. 
 
As the world faces dollar funding stress, the RBI`s foreign exchange management strategy (spot intervention + Buy-Sell swaps) could backfire, if persisted for long, Emkay Global said. 
 
According to Emkay Global, the Indian rupee performance has been caught between worsening external terms of trade led by oil, a fast-changing global risk environment, sharp foreign portfolio investments (equity) outflows and the RBI`s foreign exchange stance.

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The increasing global crude oil prices and inflation concerns turned slippery for the Indian rupee as it went down against the US dollar on Tuesday. Further, foreign investors (FII) continued to sell their equity holdings on the bourses.

The increasing global crude oil prices and inflation concerns turned slippery for the Indian rupee as it went down against the US dollar on Tuesday. Further, foreign investors (FII) continued to sell their equity holdings on the bourses. The Indian rupee opened at Rs 78.50 and went down to touch a fresh record low of 78.68 against the dollar. As crude prices increase, the rupee may further slip down, analysts said. The Reserve Bank of India (RBI) intervened by selling dollars to stabilise the rupee rate but the demand for the US currency was high. According to a report by Emkay Global Financial Services Ltd, a total of $34 billion (FII equities and FII debt) has flown out of India during the last eight months. As the world faces dollar funding stress, the RBI`s foreign exchange management strategy (spot intervention + Buy-Sell swaps) could backfire, if persisted for long, Emkay Global said. According to Emkay Global, the Indian rupee performance has been caught between worsening external terms of trade led by oil, a fast-changing global risk environment, sharp foreign portfolio investments (equity) outflows and the RBI`s foreign exchange stance. WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

Indian rupee slips to 78.68 against US dollar

Global markets suffered their worst slide since June 2020 amid uncertainties surrounding the war and pandemic. The Indian Rupee hit an all-time low against the US Dollar. Are these indications of a looming recession? Palki Sharma tells you.

Gravitas: Worst day for global markets since June 2020

These are challenging times for the Indian Rupee. A study claims the Rupee is set to end the year as Asia's worst-performing emerging market currency. What are the challenges? Palki Sharma tells you.

Gravitas: Is Indian Rupee 'Asia's worst-performing currency'?

The Indian rupee tanked 36 paise to an all-time low of 76.80 against the US dollar in opening trade on Thursday, tracking weak domestic equities and a sharp rise in coronavirus cases in the country.

Forex traders said the weakness in the rupee was largely due to strengthening of the US Dollar against the basket of currencies as investors fled to safe-haven Greenback amid weakening risk appetite in the markets.

The rupee opened weak at 76.75 at the interbank forex market and then fell further to hit an all-time low of 76.80, down 36 paise over its last close.

The rupee had settled at 76.44 against the US dollar on Wednesday.

The currency could also track local equity markets which started on a negative note as Asian stock markets are set to tumble amid increasing gloomy economic outlooks for Asia, Reliance Securities said in a report.

IMF said Thursday that Asia's economic growth this year will grind to a halt for the first time in 60 years, as the coronavirus crisis takes an "unprecedented" toll on the region's service sector and major export destinations, the report noted.

Moreover, market participants are also concerned that the sharp rise in coronavirus cases, could weigh on the economy.

The number of cases around the world linked to the new coronavirus has crossed over 20 lakh. In India, nearly 12,000 coronavirus cases have been reported so far.

Brent crude futures, the global oil benchmark, rose 1.44 per cent to USD 28.09 per barrel.

Foreign institutional investors (FIIs) were net buyers in the capital markets, as they bought shares worth Rs 1,358.66 crore on Wednesday, as per provisional data.

Domestic bourses opened on a negative note with benchmark indices Sensex trading 116.89 points lower at 30,262.92 and Nifty down by 36.50 points at 8,888.80.

The dollar index, which gauges the greenback's strength against a basket of six currencies, rose by 0.46 per cent to 99.91. &nbsp;

The Indian rupee tanked 36 paise to an all-time low of 76.80 against the US dollar in opening trade on Thursday, tracking weak domestic equities and a sharp rise in coronavirus cases in the country.

The Indian rupee tanked 36 paise to an all-time low of 76.80 against the US dollar in opening trade on Thursday, tracking weak domestic equities and a sharp rise in coronavirus cases in the country. Forex traders said the weakness in the rupee was largely due to strengthening of the US Dollar against the basket of currencies as investors fled to safe-haven Greenback amid weakening risk appetite in the markets. The rupee opened weak at 76.75 at the interbank forex market and then fell further to hit an all-time low of 76.80, down 36 paise over its last close. The rupee had settled at 76.44 against the US dollar on Wednesday. The currency could also track local equity markets which started on a negative note as Asian stock markets are set to tumble amid increasing gloomy economic outlooks for Asia, Reliance Securities said in a report. IMF said Thursday that Asia's economic growth this year will grind to a halt for the first time in 60 years, as the coronavirus crisis takes an "unprecedented" toll on the region's service sector and major export destinations, the report noted. Moreover, market participants are also concerned that the sharp rise in coronavirus cases, could weigh on the economy. The number of cases around the world linked to the new coronavirus has crossed over 20 lakh. In India, nearly 12,000 coronavirus cases have been reported so far. Brent crude futures, the global oil benchmark, rose 1.44 per cent to USD 28.09 per barrel. Foreign institutional investors (FIIs) were net buyers in the capital markets, as they bought shares worth Rs 1,358.66 crore on Wednesday, as per provisional data. Domestic bourses opened on a negative note with benchmark indices Sensex trading 116.89 points lower at 30,262.92 and Nifty down by 36.50 points at 8,888.80. The dollar index, which gauges the greenback's strength against a basket of six currencies, rose by 0.46 per cent to 99.91.

Rupee tanks 36 paise to all-time low of 76.80 against US dollar in early trade

The yen and other safe-haven currencies were in demand on Monday, along with assets such as gold, as investors fretted that the killing of Iran's most prominent military commander by the United States could trigger a broader Middle East conflict. However, the Indian Rupee has slipped further since the conflict broke out from 71 rupees and 13 paise on New Year's. It has now risen to around 72 rupees against the US dollar. #USAirStike #USIranTension #IndianRupee #USDollar

Amid US-Iran tensions Indian rupee slips further

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