The rupee recovered 21 paise to 72.91 against the US dollar early Tuesday on increased selling by exporters.

The dollar's weakness against some currencies overseas and a better opening of the domestic equity market also supported the rupee, dealers said,.

At the interbank forex market, the rupee opened strong at 72.98 and advanced further to trade at 72.91, reflecting a rise of 21 paise over its previous close of 73.12 against the dollar.

On Monday, the Indian rupee tumbled 67 paise to close at 73.12 against the US dollar on increased demand for the American currency from importers and unabated foreign fund outflows.

Meanwhile, the benchmark Sensex rose 118.44 points, or 0.34 per cent, to 35,069.36 in opening trade Tuesday.&nbsp;

The rupee recovered 21 paise to 72.91 against the US dollar early Tuesday on increased selling by exporters. The dollar's weakness against some currencies overseas and a better opening of the domestic equity market also supported the rupee, dealers said,.

The rupee recovered 21 paise to 72.91 against the US dollar early Tuesday on increased selling by exporters. The dollar's weakness against some currencies overseas and a better opening of the domestic equity market also supported the rupee, dealers said,. At the interbank forex market, the rupee opened strong at 72.98 and advanced further to trade at 72.91, reflecting a rise of 21 paise over its previous close of 73.12 against the dollar. On Monday, the Indian rupee tumbled 67 paise to close at 73.12 against the US dollar on increased demand for the American currency from importers and unabated foreign fund outflows. Meanwhile, the benchmark Sensex rose 118.44 points, or 0.34 per cent, to 35,069.36 in opening trade Tuesday.

Rupee recovers 21 paise to 72.91 against US dollar

The rupee depreciated 34 paise to 72.79 against the US dollar in early trade at the interbank forex market Monday on foreign fund outflows.

The rupee opened lower at 72.76 per dollar against the previous close of 72.45 and dropped further to quote 34 paise down at 72.79 in opening trade.

Traders said increased demand for the US currency from importers and losses in the domestic equity market weighed on the rupee.

Besides, the dollar trading higher against some currencies overseas too put pressure on the rupee, they added.

The rupee on Friday clocked its biggest single-day gain in over five years, surging by 100 paise to close at 72.45 against the US dollar on easing crude oil prices.

The benchmark BSE Sensex fall 100.54 points, or 0.29 per cent, to 34,911.11 in the opening session.&nbsp;

The rupee depreciated 34 paise to 72.79 against the US dollar in early trade at the interbank forex market Monday on foreign fund outflows. The rupee opened lower at 72.

The rupee depreciated 34 paise to 72.79 against the US dollar in early trade at the interbank forex market Monday on foreign fund outflows. The rupee opened lower at 72.76 per dollar against the previous close of 72.45 and dropped further to quote 34 paise down at 72.79 in opening trade. Traders said increased demand for the US currency from importers and losses in the domestic equity market weighed on the rupee. Besides, the dollar trading higher against some currencies overseas too put pressure on the rupee, they added. The rupee on Friday clocked its biggest single-day gain in over five years, surging by 100 paise to close at 72.45 against the US dollar on easing crude oil prices. The benchmark BSE Sensex fall 100.54 points, or 0.29 per cent, to 34,911.11 in the opening session.

Rupee falls 34 paise against US dollar in early trade

The benchmark BSE Sensex dropped 61 points and settled below the 35,000 marks Monday, tracking weak Asian stocks amid uncertainty around the China-US trade war, fall in rupee and unabated foreign fund outflows.

The Sensex fell below the 35,000-level to touch a low of 34,811.60 due to heavy selling pressure in view of foreign capital outflows and weak global cues.

However, fag-end buying helped to trim losses and the index closed at 34,950.92 with a fall of 60.73 points, or 0.17 per cent.

The gauge had rallied almost 580 points on Friday.

The broader NSE Nifty, after slipping below the 10,500-mark to hit a low of 10,477, finally concluded 29 points, or 0.27 per cent, down at 10,524.

The rupee depreciated 67 paise, to 73.12 (intra-day) against the dollar too had a negative influence.

The market was volatile in a narrow range due to weak global cues and selling pressure in pharma, FMCG and auto, analysts said.

"Rupee weakened on account of crunch in domestic liquidity while the gradual decline in yield may ease the concern. Investors' bit conservative in the holiday-shortened week due to uncertainty regarding US-China trade deal and Fed policy," they added.

Meanwhile, foreign institutional investors (FIIs) sold shares worth a net of Rs 196.90 crore, while domestic institutional investors (DIIs) bought shares to the tune of Rs 852.99 crore.

The benchmark BSE Sensex dropped 61 points and settled below the 35,000 marks Monday, tracking weak Asian stocks amid uncertainty around the China-US trade war, fall in rupee and unabated foreign fund outflows.

The benchmark BSE Sensex dropped 61 points and settled below the 35,000 marks Monday, tracking weak Asian stocks amid uncertainty around the China-US trade war, fall in rupee and unabated foreign fund outflows. The Sensex fell below the 35,000-level to touch a low of 34,811.60 due to heavy selling pressure in view of foreign capital outflows and weak global cues. However, fag-end buying helped to trim losses and the index closed at 34,950.92 with a fall of 60.73 points, or 0.17 per cent. The gauge had rallied almost 580 points on Friday. The broader NSE Nifty, after slipping below the 10,500-mark to hit a low of 10,477, finally concluded 29 points, or 0.27 per cent, down at 10,524. The rupee depreciated 67 paise, to 73.12 (intra-day) against the dollar too had a negative influence. The market was volatile in a narrow range due to weak global cues and selling pressure in pharma, FMCG and auto, analysts said. "Rupee weakened on account of crunch in domestic liquidity while the gradual decline in yield may ease the concern. Investors' bit conservative in the holiday-shortened week due to uncertainty regarding US-China trade deal and Fed policy," they added. Meanwhile, foreign institutional investors (FIIs) sold shares worth a net of Rs 196.90 crore, while domestic institutional investors (DIIs) bought shares to the tune of Rs 852.99 crore.

Sensex drops 61 points on negative global cues, weak rupee

With global crude prices remaining elevated, the rupee is likely to be under pressure, and may touch the 76-level&nbsp;against the US currency over the next three months, says a report.

The domestic currency has already crossed the 74 mark owing to continued strengthening of the dollar, lack of foreign flows and higher crude oil prices.

The unit lost over 15 per cent since the beginning of the calendar year.

"Assuming global crude prices stay elevated (slightly above $80/a barrel), we retain our bearish view on the rupee and see it plumbing to 76 over the next three months," says a weekend report by the Swiss brokerage UBS.

From April to the first week of August 2018, the RBI has been intervening in the forex markets to contain volatility, which lead to a massive drop in the forex reserves that plunged by $25 billion to $393 billion last week.

This has led to two successive repo rate hikes to the tune of 50 basis points in total.

By keeping policy rates on hold in October, the RBI hinted that it will not use interest rate defence as a tool to manage currency weakness, the report said.

Between April and October, the forex reserves has come down by $32.78 billion, while foreign exchange reserves stood at $392.078 billion as on October 26.

"Unlike in 2013, even as the rupee has weakened by 15 per cent calendar year-to-date against the dollar, it remains outside that group of most vulnerable currencies and the countrys forex reserves position is still reasonable," UBS analyst Gautam Chhaochharia said in the report.

He said while the country remains vulnerable in its external position, there is no need to press the panic button for NRI bond issuances, to stabilise the rupee, yet unless it becomes a political issue in the run-up to the 2019 general elections.

"However, in case external stress continues to rise from here (Brent continue to rise towards $100/a barrel and/or the rupee weakens towards the 80 levels, the option of raising dollar deposits ($30-35 billion) could be explored to stabilise the rupee," Chhaochharia said.

The report said the loose monetary and fiscal policy pursued by the policymakers five years ago led to exacerbated macroeconomic imbalances when the US Fed announced the start of tapering.

This caused the rupee to be amongst the "fragile five" currencies.

It believes that the macro fundamentals compare favourably with those in 2013 as policy buffers have been created.

"The inflationary pressures are manageable thanks to lower food prices, and the government remains committed to fiscal discipline although the deficit targets are quite stretched, and even as we expect the CAD to widen to 2.7 per cent of GDP in FY19, it is well below the 4.8 per cent peak registered in FY13," the report said, adding the

RBI's policy tilt is no longer accommodative.

The report further says the current liquidity shortage triggered bydefault by IL&amp;FS and group companies on their debt obligation is a liquidity squeeze and not systematic risk.

"We expect the RBI to neutralise the liquidity squeeze but think that an `easy money' period is not coming back in a hurry," it added.&nbsp;

&nbsp;

With global crude prices remaining elevated, the rupee is likely to be under pressure, and may touch the 76-level against the US currency over the next three months, says a report.

With global crude prices remaining elevated, the rupee is likely to be under pressure, and may touch the 76-level against the US currency over the next three months, says a report. The domestic currency has already crossed the 74 mark owing to continued strengthening of the dollar, lack of foreign flows and higher crude oil prices. The unit lost over 15 per cent since the beginning of the calendar year. "Assuming global crude prices stay elevated (slightly above $80/a barrel), we retain our bearish view on the rupee and see it plumbing to 76 over the next three months," says a weekend report by the Swiss brokerage UBS. From April to the first week of August 2018, the RBI has been intervening in the forex markets to contain volatility, which lead to a massive drop in the forex reserves that plunged by $25 billion to $393 billion last week. This has led to two successive repo rate hikes to the tune of 50 basis points in total. By keeping policy rates on hold in October, the RBI hinted that it will not use interest rate defence as a tool to manage currency weakness, the report said. Between April and October, the forex reserves has come down by $32.78 billion, while foreign exchange reserves stood at $392.078 billion as on October 26. "Unlike in 2013, even as the rupee has weakened by 15 per cent calendar year-to-date against the dollar, it remains outside that group of most vulnerable currencies and the countrys forex reserves position is still reasonable," UBS analyst Gautam Chhaochharia said in the report. He said while the country remains vulnerable in its external position, there is no need to press the panic button for NRI bond issuances, to stabilise the rupee, yet unless it becomes a political issue in the run-up to the 2019 general elections. "However, in case external stress continues to rise from here (Brent continue to rise towards $100/a barrel and/or the rupee weakens towards the 80 levels, the option of raising dollar deposits ($30-35 billion) could be explored to stabilise the rupee," Chhaochharia said. The report said the loose monetary and fiscal policy pursued by the policymakers five years ago led to exacerbated macroeconomic imbalances when the US Fed announced the start of tapering. This caused the rupee to be amongst the "fragile five" currencies. It believes that the macro fundamentals compare favourably with those in 2013 as policy buffers have been created. "The inflationary pressures are manageable thanks to lower food prices, and the government remains committed to fiscal discipline although the deficit targets are quite stretched, and even as we expect the CAD to widen to 2.7 per cent of GDP in FY19, it is well below the 4.8 per cent peak registered in FY13," the report said, adding the RBI's policy tilt is no longer accommodative. The report further says the current liquidity shortage triggered bydefault by IL&FS and group companies on their debt obligation is a liquidity squeeze and not systematic risk. "We expect the RBI to neutralise the liquidity squeeze but think that an `easy money' period is not coming back in a hurry," it added.

Rupee may touch 76-level against dollar in next 3 months: Report

The rupee appreciated 31 paise to 73.14 against the dollar at the interbank foreign exchange Friday after crude prices fell to seven-month lows in the global market amid fresh foreign fund inflows.

The rise was also supported by dollar-selling by exporters and banks and the US unit's weakness against some currencies overseas, traders said.

They said a higher opening in the domestic equity market too supported the rupee.

Brent crude, the international benchmark, dropped 3.48 per cent to trade at a seven-month low of $ 72.65 per barrel on higher supply from world's major producers.

The rupee had gained 50 paise to close at 73.45 against the US dollar Thursday, posting its biggest single-session spurt in three weeks on increased selling of the greenback by exporters, softening crude oil prices and upbeat economic numbers.

Foreign institutional investors (FIIs), which had been selling on Indian bourses, made fresh purchases worth Rs 348.75 crore Thursday, as per provisional data.

Meanwhile, the benchmark BSE Sensex rose 271.38 points, 0.81 per cent, to trade at 34,703.35 in early trade.

The rupee appreciated 31 paise to 73.14 against the dollar at the interbank foreign exchange Friday after crude prices fell to seven-month lows in the global market amid fresh foreign fund inflows.

The rupee appreciated 31 paise to 73.14 against the dollar at the interbank foreign exchange Friday after crude prices fell to seven-month lows in the global market amid fresh foreign fund inflows. The rise was also supported by dollar-selling by exporters and banks and the US unit's weakness against some currencies overseas, traders said. They said a higher opening in the domestic equity market too supported the rupee. Brent crude, the international benchmark, dropped 3.48 per cent to trade at a seven-month low of $ 72.65 per barrel on higher supply from world's major producers. The rupee had gained 50 paise to close at 73.45 against the US dollar Thursday, posting its biggest single-session spurt in three weeks on increased selling of the greenback by exporters, softening crude oil prices and upbeat economic numbers. Foreign institutional investors (FIIs), which had been selling on Indian bourses, made fresh purchases worth Rs 348.75 crore Thursday, as per provisional data. Meanwhile, the benchmark BSE Sensex rose 271.38 points, 0.81 per cent, to trade at 34,703.35 in early trade.

Rupee rises 31 paise against US dollar on falling crude prices

Pakistan's annual inflation rate jumped to 7 per cent in October, the highest in four years, from 5.12 per cent a month earlier, due to a steep rise in gas prices and multiple devaluations of the rupee.

On a month-on-month basis, prices spiked 2.56 per cent in October, according to data released by the Bureau of Statistics on Friday. Prices fell 0.06 per cent in September on the same basis.

The annual inflation rate is the highest since September 2014, when it had hit 7.68 per cent.

The surge in inflation was caused by a 104.91 per cent hike in gas prices. Pakistan's central bank had warned in September that rising oil prices and currency devaluations were likely to push up underlying inflation.

The country's central bank has devalued the local currency five times since December, weakening it by 26 per cent against the dollar during the period.

In September, Pakistan raised natural gas prices by up to 20 per cent, slashing consumer subsidies that were a fiscal drag on the government's budget.

In an effort to avert a looming currency crisis, Pakistan has been seeking economic assistance from the International Monetary Fund and friendly countries.

Saudi Arabia agreed to a $6 billion rescue package earlier this month and new Prime Minister Imran Khan is visiting China this week in search of fresh loans from Beijing.

Pakistan's annual inflation rate jumped to 7 per cent in October, the highest in four years, from 5.12 per cent a month earlier, due to a steep rise in gas prices and multiple devaluations of the rupee.

Pakistan's annual inflation rate jumped to 7 per cent in October, the highest in four years, from 5.12 per cent a month earlier, due to a steep rise in gas prices and multiple devaluations of the rupee. On a month-on-month basis, prices spiked 2.56 per cent in October, according to data released by the Bureau of Statistics on Friday. Prices fell 0.06 per cent in September on the same basis. The annual inflation rate is the highest since September 2014, when it had hit 7.68 per cent. The surge in inflation was caused by a 104.91 per cent hike in gas prices. Pakistan's central bank had warned in September that rising oil prices and currency devaluations were likely to push up underlying inflation. The country's central bank has devalued the local currency five times since December, weakening it by 26 per cent against the dollar during the period. In September, Pakistan raised natural gas prices by up to 20 per cent, slashing consumer subsidies that were a fiscal drag on the government's budget. In an effort to avert a looming currency crisis, Pakistan has been seeking economic assistance from the International Monetary Fund and friendly countries. Saudi Arabia agreed to a $6 billion rescue package earlier this month and new Prime Minister Imran Khan is visiting China this week in search of fresh loans from Beijing.

Pakistan October inflation at four-year high on gas price hike, rupee fall

The rupee rebounded 11 paise to 73.84 against the dollar in early trade Thursday on increased selling of the American currency by exporters.

At the interbank foreign exchange, after opening higher at 73.88 rupee strengthened further to quote at 73.84 against the dollar registering a recovery of 11 paise over its previous close.

The dollar's weakness against some currencies overseas and a better opening of domestic equities supported the rupee's recovery, traders said.

Easing concerns around the rift between the government and the RBI, after the Finance Ministry said the autonomy for the central bank, within the framework of the RBI Act, was an "essential and accepted" governance requirement, also lifted the the local unit, they added.

On Wednesday, the rupee had plunged 27 paise to close at nearly three-week low of 73.95 as the American currency strengthened against major global currencies overseas amid steady capital outflows.

Meanwhile, the benchmark Sensex went up 149.36 points, or 0.44 per cent, to 34,591.41 in opening trade.&nbsp;

The rupee rebounded 11 paise to 73.84 against the dollar in early trade Thursday on increased selling of the American currency by exporters. At the interbank foreign exchange, after opening higher at 73.

The rupee rebounded 11 paise to 73.84 against the dollar in early trade Thursday on increased selling of the American currency by exporters. At the interbank foreign exchange, after opening higher at 73.88 rupee strengthened further to quote at 73.84 against the dollar registering a recovery of 11 paise over its previous close. The dollar's weakness against some currencies overseas and a better opening of domestic equities supported the rupee's recovery, traders said. Easing concerns around the rift between the government and the RBI, after the Finance Ministry said the autonomy for the central bank, within the framework of the RBI Act, was an "essential and accepted" governance requirement, also lifted the the local unit, they added. On Wednesday, the rupee had plunged 27 paise to close at nearly three-week low of 73.95 as the American currency strengthened against major global currencies overseas amid steady capital outflows. Meanwhile, the benchmark Sensex went up 149.36 points, or 0.44 per cent, to 34,591.41 in opening trade.

Rupee rises 11 paise to 73.84 against US dollar

US midterm polls 2018: How elections could ripple through markets

The rupee dropped by 43 paise to 74.11 against the US dollar in early trade Wednesday, amid increased demand of the American currencies from importers and sustained foreign fund outflows.

Forex traders said, the US dollar's strength against some currencies overseas and concerns around the rift between the government and the RBI also weighed on the local unit.

At the interbank foreign exchange, after opening lower at 73.91, rupee weakened further to quote at 74.11 against the dollar registering a fall of 43 paise over its pervious close.

The rupee Tuesday depreciated 23 paise to close at 73.68 against the US dollar.

A stable crude oil prices, however, restricted the rupee fall to some extent, forex traders said.

Globally, Brent crude, the international benchmark, was trading 0.62 per cent up at US $76.38 per barrel.

Meanwhile, the Reserve Bank of India has said that it will inject Rs 40,000 crore into the system in November by buying government bonds through open market operations (OMO) for maintaining liquidity in the market.

On a net basis, foreign investors pulled out Rs 1,592.02 crore from equity markets Tuesday, as per provisional data.

Meanwhile, the benchmark BSE Sensex opened on a higher note up 158.99 points, but soon pared the gains and was trading at 33,627.83, down 263.30 points or 0.78 per cent at 1020 hrs.

The rupee dropped by 43 paise to 74.11 against the US dollar in early trade Wednesday, amid increased demand of the American currencies from importers and sustained foreign fund outflows.

The rupee dropped by 43 paise to 74.11 against the US dollar in early trade Wednesday, amid increased demand of the American currencies from importers and sustained foreign fund outflows. Forex traders said, the US dollar's strength against some currencies overseas and concerns around the rift between the government and the RBI also weighed on the local unit. At the interbank foreign exchange, after opening lower at 73.91, rupee weakened further to quote at 74.11 against the dollar registering a fall of 43 paise over its pervious close. The rupee Tuesday depreciated 23 paise to close at 73.68 against the US dollar. A stable crude oil prices, however, restricted the rupee fall to some extent, forex traders said. Globally, Brent crude, the international benchmark, was trading 0.62 per cent up at US $76.38 per barrel. Meanwhile, the Reserve Bank of India has said that it will inject Rs 40,000 crore into the system in November by buying government bonds through open market operations (OMO) for maintaining liquidity in the market. On a net basis, foreign investors pulled out Rs 1,592.02 crore from equity markets Tuesday, as per provisional data. Meanwhile, the benchmark BSE Sensex opened on a higher note up 158.99 points, but soon pared the gains and was trading at 33,627.83, down 263.30 points or 0.78 per cent at 1020 hrs.

Rupee falls 43 paise to 74.11 against the US dollar in early trade

The rupee weakened by 16 paise to 73.61 against the US dollar in early trade Tuesday, amid increased demand of the American currencies from importers and sustained foreign fund outflows.

Traders said the US dollar's strength against some currencies overseas and a lower opening in the domestic equity markets also weighed on the local unit.

At the interbank foreign exchange, after opening lower at 73.58, rupee weakened further to quote at 73.61 against the dollar registering a fall of 16 paise over its pervious close.

The rupee ended almost flat at 73.45 against the US dollar Monday.

The dollar's weakness against some currencies overseas and easing crude oil prices, however, restricted the rupee fall, forex traders said.

Globally, Brent crude, the international benchmark, was trading 0.36 per cent down at USD 77.06 per barrel.

On a net basis, foreign investors pulled out Rs 2,230.79 crore from equity markets Monday, as per provisional data.

Meanwhile, the benchmark BSE Sensex plunged 135.93 points, to 33,931.47 in the opening trade.

The rupee weakened by 16 paise to 73.61 against the US dollar in early trade Tuesday, amid increased demand of the American currencies from importers and sustained foreign fund outflows.

The rupee weakened by 16 paise to 73.61 against the US dollar in early trade Tuesday, amid increased demand of the American currencies from importers and sustained foreign fund outflows. Traders said the US dollar's strength against some currencies overseas and a lower opening in the domestic equity markets also weighed on the local unit. At the interbank foreign exchange, after opening lower at 73.58, rupee weakened further to quote at 73.61 against the dollar registering a fall of 16 paise over its pervious close. The rupee ended almost flat at 73.45 against the US dollar Monday. The dollar's weakness against some currencies overseas and easing crude oil prices, however, restricted the rupee fall, forex traders said. Globally, Brent crude, the international benchmark, was trading 0.36 per cent down at USD 77.06 per barrel. On a net basis, foreign investors pulled out Rs 2,230.79 crore from equity markets Monday, as per provisional data. Meanwhile, the benchmark BSE Sensex plunged 135.93 points, to 33,931.47 in the opening trade.

Rupee falls 16 paise to 73.61 against US dollar in early trade

What the government giveth, the government taketh. Beginning 1934, the Reserve Bank of India has enjoyed uninterrupted and unquestionable primacy in all things monetary in India.&nbsp;

The sudden volte-face by the government, has therefore shaken the RBI to its very foundations. When the inter-ministerial committee (IC) was constituted in October 2017, little did the RBI realise that it would result in ending its long era of dominance over regulating payment systems in India.

A quick flashback takes us to the RBI Act of 1934, which vested all matters monetary and regulatory with the central bank. This was consolidated with the Payment and Settlement Systems Act, 2007 (PSS Act) designating RBI, the banking regulator, as the over seer for all forms of payment systems.

The IC Report with its recommendation for a Payment Regulatory Board (PRB) with RBI being a minority stakeholder, has truly shaken and stirred the regulator, who till date exercised a monopoly over proceedings.&nbsp;

Even under the PSS Act of 2007, there was a central board comprised only of RBI representatives with its governor in the chair. The PRB, first mooted under the Finance Act 2017, paved the first step towards the dilution of RBI’s monopoly with its inclusion of equal representation of three central government representatives along with three RBI officials. The Finance Act, however, still vested the RBI governor with the position of ex-officio chairperson.

Then came the blow through the IC Report, which proposes for any “Person appointed by the government in consultation with the RBI”, to be appointed as the ex-officio chairperson.&nbsp;

Further, with the increase in the composition of the PRB to seven members with four (including the chairperson) being central government representatives, RBI clearly becomes a minority presence.

The central bank has not questioned government representation on the proposed PRB, but has voiced strong dissent against the dilution of its powers – especially of the chairperson no longer being only the RBI governor.&nbsp;

It has therefore insisted on this as also for veto powers to the chairperson, to ensure its majority. Its claim is based inter alia on its role as the banking regulator and hence the need for harmonious regulations.

The IC’s concessions to RBI’s dissent is to include the need for the chairperson to have “experience in the central banking function” and for RBI to have the power to “make a reference” to the PRB for consideration of issues pertaining to monetary policies. Neither of these meets the RBI’s pitch for retaining its power over regulating payment systems.

RBI faces a strong threat to unfettered primacy over regulating payment systems and its fear that this is only the beginning, may also not be misconceived. After all, RBI is no stranger to trespassing on alternate turfs, as was evident from its April 6, 2018, circular on financial data localisation by all payment systems, upstaging the then awaited government committee report.

The possibilities facing RBI now are (a) divestment of powers over payment systems, (b) dilution of its monopoly over regulating payment systems to merely a recommendatory role and (c) being reduced from a monopolistic regulatory position to that of an advisory one.&nbsp;

The implications for the nation are larger with the central government taking back the power to regulate payment systems instead of the settled construct of a unitary regulatory body exercising powers over all things monetary.&nbsp;

On one hand, this may reduce the now palpable friction between government policies or intent and regulatory execution (through RBI) and ensure harmony. On the other, monetary policies will seesaw with every change in the government. &nbsp;

Such state of flux may not augur well for certainty or stability in monetary policies. Internal turf wars then become a definitive possibility.

Legally speaking, RBI would be hard pressed to prove its claim to retain its monopolistic regulatory right. The sovereign right over deciding India’s monetary policy vests with the central government.

RBI’s right to regulate payment systems is through statutory authority vested under the PSS Act of 2007. This, of course, can or may be modified through parliamentary process, which is what the proposed amendments to the PSS Act envisages.&nbsp;

Prolonged vesting of authority in RBI by itself is therefore not going to be sufficient for the central bank to sustain its claim. The separation of powers argued by the RBI in its dissent note is one of vested authority and not a constitutional one.&nbsp;

The RBI dissent is that of a singular minority in the report of the IC and the majority view may therefore prevail. In any event, the report itself is merely a recommendation. It is for the houses of Parliament (or the Finance Act route) to decide the future of regulation of payment systems.&nbsp;

Payment systems now permeate chat apps and online games. In just a decade, private, especially international players, have slowly become the primary or preferred payment mechanisms, as opposed to banks. Despite tightening of regulation, private players have consistently found loopholes.

The recent thrust has been towards digital payment alternatives, especially after demonetisation.&nbsp;

In a world ill-equipped to deal with evolving technologies – abject digital illiteracy, poor enforcement mechanisms against evolving cyber-crimes, financial frauds, Ponzi schemes and technology-enabled crimes, the urgent need is for a strong regulator with sufficient powers to not only prevent, but to also protect and punish.&nbsp;

 
(This article was originally published on DNA. Read the <a href="https://www.dnaindia.com/analysis/column-rocking-the-central-bank-2680325">original article</a>)

(Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL)

&nbsp;

What the government giveth, the government taketh. Beginning 1934, the Reserve Bank of India has enjoyed uninterrupted and unquestionable primacy in all things monetary in India.

What the government giveth, the government taketh. Beginning 1934, the Reserve Bank of India has enjoyed uninterrupted and unquestionable primacy in all things monetary in India. The sudden volte-face by the government, has therefore shaken the RBI to its very foundations. When the inter-ministerial committee (IC) was constituted in October 2017, little did the RBI realise that it would result in ending its long era of dominance over regulating payment systems in India. A quick flashback takes us to the RBI Act of 1934, which vested all matters monetary and regulatory with the central bank. This was consolidated with the Payment and Settlement Systems Act, 2007 (PSS Act) designating RBI, the banking regulator, as the over seer for all forms of payment systems. The IC Report with its recommendation for a Payment Regulatory Board (PRB) with RBI being a minority stakeholder, has truly shaken and stirred the regulator, who till date exercised a monopoly over proceedings. Even under the PSS Act of 2007, there was a central board comprised only of RBI representatives with its governor in the chair. The PRB, first mooted under the Finance Act 2017, paved the first step towards the dilution of RBI’s monopoly with its inclusion of equal representation of three central government representatives along with three RBI officials. The Finance Act, however, still vested the RBI governor with the position of ex-officio chairperson. Then came the blow through the IC Report, which proposes for any “Person appointed by the government in consultation with the RBI”, to be appointed as the ex-officio chairperson. Further, with the increase in the composition of the PRB to seven members with four (including the chairperson) being central government representatives, RBI clearly becomes a minority presence. The central bank has not questioned government representation on the proposed PRB, but has voiced strong dissent against the dilution of its powers – especially of the chairperson no longer being only the RBI governor. It has therefore insisted on this as also for veto powers to the chairperson, to ensure its majority. Its claim is based inter alia on its role as the banking regulator and hence the need for harmonious regulations. The IC’s concessions to RBI’s dissent is to include the need for the chairperson to have “experience in the central banking function” and for RBI to have the power to “make a reference” to the PRB for consideration of issues pertaining to monetary policies. Neither of these meets the RBI’s pitch for retaining its power over regulating payment systems. RBI faces a strong threat to unfettered primacy over regulating payment systems and its fear that this is only the beginning, may also not be misconceived. After all, RBI is no stranger to trespassing on alternate turfs, as was evident from its April 6, 2018, circular on financial data localisation by all payment systems, upstaging the then awaited government committee report. The possibilities facing RBI now are (a) divestment of powers over payment systems, (b) dilution of its monopoly over regulating payment systems to merely a recommendatory role and (c) being reduced from a monopolistic regulatory position to that of an advisory one. The implications for the nation are larger with the central government taking back the power to regulate payment systems instead of the settled construct of a unitary regulatory body exercising powers over all things monetary. On one hand, this may reduce the now palpable friction between government policies or intent and regulatory execution (through RBI) and ensure harmony. On the other, monetary policies will seesaw with every change in the government. Such state of flux may not augur well for certainty or stability in monetary policies. Internal turf wars then become a definitive possibility. Legally speaking, RBI would be hard pressed to prove its claim to retain its monopolistic regulatory right. The sovereign right over deciding India’s monetary policy vests with the central government. RBI’s right to regulate payment systems is through statutory authority vested under the PSS Act of 2007. This, of course, can or may be modified through parliamentary process, which is what the proposed amendments to the PSS Act envisages. Prolonged vesting of authority in RBI by itself is therefore not going to be sufficient for the central bank to sustain its claim. The separation of powers argued by the RBI in its dissent note is one of vested authority and not a constitutional one. The RBI dissent is that of a singular minority in the report of the IC and the majority view may therefore prevail. In any event, the report itself is merely a recommendation. It is for the houses of Parliament (or the Finance Act route) to decide the future of regulation of payment systems. Payment systems now permeate chat apps and online games. In just a decade, private, especially international players, have slowly become the primary or preferred payment mechanisms, as opposed to banks. Despite tightening of regulation, private players have consistently found loopholes. The recent thrust has been towards digital payment alternatives, especially after demonetisation. In a world ill-equipped to deal with evolving technologies – abject digital illiteracy, poor enforcement mechanisms against evolving cyber-crimes, financial frauds, Ponzi schemes and technology-enabled crimes, the urgent need is for a strong regulator with sufficient powers to not only prevent, but to also protect and punish. (This article was originally published on DNA. Read the original article) (Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL)

Rocking the central bank

The rupee recovered by 14 paise to 73.33 against the US currency in early trade Monday, on fresh dollar selling by exporters and higher opening in the domestic equity markets.

At the Interbank Foreign Exchange, the rupee opened up at 73.33 to quote 14 paise higher over its previous closing, on increased selling of the American currency by exporters and banks.

On Friday, the rupee had depreciated by 20 paise to close at 73.47 against the US dollar.

Forex dealers said, weakness in the dollar against a few currencies overseas and easing crude prices gave some support to the local unit.

Globally, Brent crude, the international benchmark, was trading 0.05 per cent down at US $77.58 per barrel.

The benchmark BSE Sensex started the session on a positive note up by 200.57 points at 33,549.88 in opening trade Monday.

On a net basis, foreign funds pulled out Rs 1,356.66 crore from the capital markets on a net basis, while domestic institutional investors bought shares worth Rs 1,875.89 crore Friday, provisional data showed.

The rupee recovered by 14 paise to 73.33 against the US currency in early trade Monday, on fresh dollar selling by exporters and higher opening in the domestic equity markets.

The rupee recovered by 14 paise to 73.33 against the US currency in early trade Monday, on fresh dollar selling by exporters and higher opening in the domestic equity markets. At the Interbank Foreign Exchange, the rupee opened up at 73.33 to quote 14 paise higher over its previous closing, on increased selling of the American currency by exporters and banks. On Friday, the rupee had depreciated by 20 paise to close at 73.47 against the US dollar. Forex dealers said, weakness in the dollar against a few currencies overseas and easing crude prices gave some support to the local unit. Globally, Brent crude, the international benchmark, was trading 0.05 per cent down at US $77.58 per barrel. The benchmark BSE Sensex started the session on a positive note up by 200.57 points at 33,549.88 in opening trade Monday. On a net basis, foreign funds pulled out Rs 1,356.66 crore from the capital markets on a net basis, while domestic institutional investors bought shares worth Rs 1,875.89 crore Friday, provisional data showed.

Rupee gains 14 paise to 73.33 against US dollar in early trade

The rupee weakened by 17 paise to 73.44 against the US dollar in early trade Friday, amid increased demand of the American currencies from importers and sustained foreign fund outflows.

Traders said the US dollar's strength against some currencies overseas and a lower opening in the domestic equity markets also weighed on the local unit.

On Thursday, the local currency had depreciated by 11 paise to close at 73.27 against the US dollar due to steady capital outflows and sharp decline in domestic equities amid intensifying geopolitical tensions.

Meanwhile, on a net basis, foreign funds sold shares worth Rs 1,495.71 crore, while domestic institutional investors bought shares to the tune of Rs 339.60 crore Thursday, provisional data showed.

The benchmark BSE Sensex fell 157.17 points, or 0.47 per cent to 33,532.92 in early trade Friday.

The rupee weakened by 17 paise to 73.44 against the US dollar in early trade Friday, amid increased demand of the American currencies from importers and sustained foreign fund outflows.

The rupee weakened by 17 paise to 73.44 against the US dollar in early trade Friday, amid increased demand of the American currencies from importers and sustained foreign fund outflows. Traders said the US dollar's strength against some currencies overseas and a lower opening in the domestic equity markets also weighed on the local unit. On Thursday, the local currency had depreciated by 11 paise to close at 73.27 against the US dollar due to steady capital outflows and sharp decline in domestic equities amid intensifying geopolitical tensions. Meanwhile, on a net basis, foreign funds sold shares worth Rs 1,495.71 crore, while domestic institutional investors bought shares to the tune of Rs 339.60 crore Thursday, provisional data showed. The benchmark BSE Sensex fell 157.17 points, or 0.47 per cent to 33,532.92 in early trade Friday.

Rupee falls 17 paise to 73.44 against US dollar in early trade

Continuing its slide, the rupee weakened by 3 paise to 73.64 against the US dollar Friday due to increased demand for the American currency from importers.

At the Interbank Foreign Exchange, the rupee opened lower at 73.62 and slipped further to 73.64 against the dollar, showing a fall of 3 paise.

Traders said besides sustained demand of the US currency from importers, a lower opening in the domestic equity markets also weighed on the local unit.

The losses in the domestic currency were however limited as the US dollar weakened against some currencies overseas.

On Wednesday, the local currency had ended lower by 13 paise to 73.61 against the US dollar.

Forex market remained shut on Thursday on account of "Dussehra".

Meanwhile, on a net basis, foreign funds bought shares worth Rs 140.02 crore, while domestic institutional investors sold shares to the tune of Rs 343.11 crore Wednesday, provisional data showed.

The benchmark BSE Sensex fell 408.45 points, or 1.17 per cent, to 34,371.13 in the opening trade.&nbsp;

Continuing its slide, the rupee weakened by 3 paise to 73.64 against the US dollar Friday due to increased demand for the American currency from importers. At the Interbank Foreign Exchange, the rupee opened lower at 73.

Continuing its slide, the rupee weakened by 3 paise to 73.64 against the US dollar Friday due to increased demand for the American currency from importers. At the Interbank Foreign Exchange, the rupee opened lower at 73.62 and slipped further to 73.64 against the dollar, showing a fall of 3 paise. Traders said besides sustained demand of the US currency from importers, a lower opening in the domestic equity markets also weighed on the local unit. The losses in the domestic currency were however limited as the US dollar weakened against some currencies overseas. On Wednesday, the local currency had ended lower by 13 paise to 73.61 against the US dollar. Forex market remained shut on Thursday on account of "Dussehra". Meanwhile, on a net basis, foreign funds bought shares worth Rs 140.02 crore, while domestic institutional investors sold shares to the tune of Rs 343.11 crore Wednesday, provisional data showed. The benchmark BSE Sensex fell 408.45 points, or 1.17 per cent, to 34,371.13 in the opening trade.

Rupee falls 3 paise to 73.64 against US dollar in early trade

The rupee weakened by 9 paise to 73.92 against the US dollar in early trade Tuesday on increased demand for the American currency from banks and importers.

At the Interbank Foreign Exchange, the domestic currency opened higher at 73.79 but lost ground and fell to 73.92.

Dealers attributed the rupee's fall to the dollar's strength against some other currencies overseas but fresh inflows by foreign funds and a higher opening in domestic equity markets, capped the losses.

Moreover, weak exports data also dampened sentiments in the forex market. India's exports entered the negative zone after five months, contracting 2.15 per cent in September to $27.95 billion, according to commerce ministry data.

The rupee had lost 26 paise to close at 73.83 Monday after crude prices rose amid intensifying geopolitical tensions.

The benchmark BSE Sensex Tuesday rose by 89.17 points, or 0.26 per cent to trade at 34,954.27.

Meanwhile, foreign portfolio investors bought shares worth Rs 67.86 crore on net basis from stock markets on Monday, according to the BSE data.

The rupee weakened by 9 paise to 73.92 against the US dollar in early trade Tuesday on increased demand for the American currency from banks and importers. At the Interbank Foreign Exchange, the domestic currency opened higher at 73.

The rupee weakened by 9 paise to 73.92 against the US dollar in early trade Tuesday on increased demand for the American currency from banks and importers. At the Interbank Foreign Exchange, the domestic currency opened higher at 73.79 but lost ground and fell to 73.92. Dealers attributed the rupee's fall to the dollar's strength against some other currencies overseas but fresh inflows by foreign funds and a higher opening in domestic equity markets, capped the losses. Moreover, weak exports data also dampened sentiments in the forex market. India's exports entered the negative zone after five months, contracting 2.15 per cent in September to $27.95 billion, according to commerce ministry data. The rupee had lost 26 paise to close at 73.83 Monday after crude prices rose amid intensifying geopolitical tensions. The benchmark BSE Sensex Tuesday rose by 89.17 points, or 0.26 per cent to trade at 34,954.27. Meanwhile, foreign portfolio investors bought shares worth Rs 67.86 crore on net basis from stock markets on Monday, according to the BSE data.

Rupee softens 9 paise against US dollar in early trade

The rupee dropped 36 paise to 73.93 against the US currency in early trade Monday, breaking its three-day recovery trend, as crude prices rose amid weak macro economic data.

<a href="http://www.wionews.com/india-news/rupee-strengthens-38-paise-against-us-dollar-170999">Also Read:&nbsp;Rupee strengthens 38 paise against US dollar</a>

A spurt in dollar demand from importers amid sustained foreign fund outflows also weighed on the rupee.

Dealers said, factors like the dollar's strength against some other currencies overseas and a volatile opening of the equity markets also impacted the domestic currency.

Industrial production slipped to a three-month low of 4.3 per cent in August and retail inflation rose marginally to 3.77 per cent in September, according to the data released by Central Statistics Office Friday.

On Friday, the rupee had ended 55 paise higher at 73.57 against the dollar, as global crude prices eased and domestic indices staged a smart rebound.

Foreign institutional investors (FIIs) sold shares to the&nbsp;tune of Rs 1,322 crore Friday, provisional data showed.

The benchmark BSE Sensex fell by 70.85 points today, or 0.20 per cent, to 34,662.73 in early trade after crossing the key 35,000-mark to hit a high of 35,008.65 at the outset.&nbsp;

The rupee dropped 36 paise to 73.93 against the US currency in early trade Monday, breaking its three-day recovery trend, as crude prices rose amid weak macro economic data.

The rupee dropped 36 paise to 73.93 against the US currency in early trade Monday, breaking its three-day recovery trend, as crude prices rose amid weak macro economic data. Also Read: Rupee strengthens 38 paise against US dollar A spurt in dollar demand from importers amid sustained foreign fund outflows also weighed on the rupee. Dealers said, factors like the dollar's strength against some other currencies overseas and a volatile opening of the equity markets also impacted the domestic currency. Industrial production slipped to a three-month low of 4.3 per cent in August and retail inflation rose marginally to 3.77 per cent in September, according to the data released by Central Statistics Office Friday. On Friday, the rupee had ended 55 paise higher at 73.57 against the dollar, as global crude prices eased and domestic indices staged a smart rebound. Foreign institutional investors (FIIs) sold shares to the tune of Rs 1,322 crore Friday, provisional data showed. The benchmark BSE Sensex fell by 70.85 points today, or 0.20 per cent, to 34,662.73 in early trade after crossing the key 35,000-mark to hit a high of 35,008.65 at the outset.

Rupee dips 36 paise against US dollar in early trade

Continuing its recovery, the rupee Friday strengthened 38 paise to 73.74 against the US dollar in early trade in the forex market after global crude prices eased.

Besides, dollar-selling by exporters and banks, the greenback's weakness against some currencies overseas, helped the recovery in the domestic currency.

Brent crude fell 3 per cent to trade at 80.37 a barrel in the global market.

Forex dealers said a higher opening in the equity market also supported the rupee's sentiment.

The local unit, after hitting a record low of 74.50 Thursday, recovered 9 paise to end at 74.12 against the dollar.

Meanwhile, the BSE benchmark Sensex rebounded 377.12 points, or 1.11 per cent, to 34,378.27 in opening trade. 
&nbsp;

Continuing its recovery, the rupee Friday strengthened 38 paise to 73.74 against the US dollar in early trade in the forex market after global crude prices eased.

Continuing its recovery, the rupee Friday strengthened 38 paise to 73.74 against the US dollar in early trade in the forex market after global crude prices eased. Besides, dollar-selling by exporters and banks, the greenback's weakness against some currencies overseas, helped the recovery in the domestic currency. Brent crude fell 3 per cent to trade at 80.37 a barrel in the global market. Forex dealers said a higher opening in the equity market also supported the rupee's sentiment. The local unit, after hitting a record low of 74.50 Thursday, recovered 9 paise to end at 74.12 against the dollar. Meanwhile, the BSE benchmark Sensex rebounded 377.12 points, or 1.11 per cent, to 34,378.27 in opening trade.

Rupee strengthens 38 paise against US dollar

India's battered rupee is expected to stay that way for a while, trading near recent record lows over the coming year even as the Reserve Bank of India is forecast to raise rates in December and once more in 2019, Reuters polling found.

The rupee has hit repeated record lows against the dollar this year in its worst run since the financial crisis. It is down over 16 per cent so far this year, tracking a deep selloff in emerging markets driven by a resurgent dollar and the ongoing US-China trade war.

While just two weeks ago a majority of economists polled by Reuters predicted the Reserve Bank of India (RBI) would hike interest rates on Oct 5, the central bank surprised by keeping its policy unchanged and said it was not targeting any currency level.

After that decision, the rupee fell to a record low of 74.25 against the dollar. On Tuesday, the partially convertible Indian currency hit a fresh low of 74.395 per dollar.

"We believe the RBI is underestimating the inflationary pressure in the Indian economy and the impact of ongoing Fed tightening," said Hugo Erken, senior economist at Rabobank, referring to a series of US&nbsp;Federal Reserve rate rises expected in the coming year.

Inflation in India was forecast to be a touch above the central bank's comfort level of around 4 per cent in the third quarter and the current one.

But India's widening current account deficit, thanks to rising oil prices and a weak rupee, combined with below-normal rainfall this year could translate into rising price pressures over the near term.

While economists were evenly split on the question of whether a rate hike was required to stop the rupee from falling further, the RBI is still expected to deliver in December. It is also forecast to follow that hike in the third quarter of next year, taking the repo rate to 7 per cent.

That suggests economists have pushed their expectations for the rate hike they had previously pencilled in for October to the next meeting, the last one scheduled for this year.

"Even as most (on the Monetary Policy Committee) voted to change the stance to 'calibrated tightening,' there was an evident lack of action on their part despite time running out to stop the rupee's worst fall in last five years," noted Prakash Sakpal, Asia economist at ING.

Still, 26 of 47 economists who answered an additional question said the RBI was right to keep policy on hold this month.

Predictions for one aggressive 50 basis point rate hike by end-2018 dropped sharply in the latest survey, with only one respondent now expecting such a move compared to 17 in the previous poll on September 25.

"We continue to look for the USDINR to head towards 75.0, factoring in our view of at least four rate hikes by the US&nbsp;Federal Reserve over the year, which will be dollar and rates positive," noted Radhika Rao, economist at DBS Group Research.

The latest Reuters poll of over 50 currency strategists taken Oct. 5-9 showed the rupee was seen trading around the current rate, about 74 per dollar, in three months and strengthening just a bit to around 73 per dollar in a year.

The weakest forecast across was 78.0 while the strongest rupee outlook was 67.97 compared to 75.6 and 66.1, respectively, in the previous month poll.

But in a year, the rupee's expected performance is broadly in line with expectations for most currencies as the dollar's resurgence is predicted to fade.

A majority, 27 of 48 analysts, said the risks were skewed more towards the rupee strengthening against the greenback over the next year. 
&nbsp;

India's battered rupee is expected to stay that way for a while, trading near recent record lows over the coming year even as the Reserve Bank of India is forecast to raise rates in December and once more in 2019, Reuters polling found.

India's battered rupee is expected to stay that way for a while, trading near recent record lows over the coming year even as the Reserve Bank of India is forecast to raise rates in December and once more in 2019, Reuters polling found. The rupee has hit repeated record lows against the dollar this year in its worst run since the financial crisis. It is down over 16 per cent so far this year, tracking a deep selloff in emerging markets driven by a resurgent dollar and the ongoing US-China trade war. While just two weeks ago a majority of economists polled by Reuters predicted the Reserve Bank of India (RBI) would hike interest rates on Oct 5, the central bank surprised by keeping its policy unchanged and said it was not targeting any currency level. After that decision, the rupee fell to a record low of 74.25 against the dollar. On Tuesday, the partially convertible Indian currency hit a fresh low of 74.395 per dollar. "We believe the RBI is underestimating the inflationary pressure in the Indian economy and the impact of ongoing Fed tightening," said Hugo Erken, senior economist at Rabobank, referring to a series of US Federal Reserve rate rises expected in the coming year. Inflation in India was forecast to be a touch above the central bank's comfort level of around 4 per cent in the third quarter and the current one. But India's widening current account deficit, thanks to rising oil prices and a weak rupee, combined with below-normal rainfall this year could translate into rising price pressures over the near term. While economists were evenly split on the question of whether a rate hike was required to stop the rupee from falling further, the RBI is still expected to deliver in December. It is also forecast to follow that hike in the third quarter of next year, taking the repo rate to 7 per cent. That suggests economists have pushed their expectations for the rate hike they had previously pencilled in for October to the next meeting, the last one scheduled for this year. "Even as most (on the Monetary Policy Committee) voted to change the stance to 'calibrated tightening,' there was an evident lack of action on their part despite time running out to stop the rupee's worst fall in last five years," noted Prakash Sakpal, Asia economist at ING. Still, 26 of 47 economists who answered an additional question said the RBI was right to keep policy on hold this month. Predictions for one aggressive 50 basis point rate hike by end-2018 dropped sharply in the latest survey, with only one respondent now expecting such a move compared to 17 in the previous poll on September 25. "We continue to look for the USDINR to head towards 75.0, factoring in our view of at least four rate hikes by the US Federal Reserve over the year, which will be dollar and rates positive," noted Radhika Rao, economist at DBS Group Research. The latest Reuters poll of over 50 currency strategists taken Oct. 5-9 showed the rupee was seen trading around the current rate, about 74 per dollar, in three months and strengthening just a bit to around 73 per dollar in a year. The weakest forecast across was 78.0 while the strongest rupee outlook was 67.97 compared to 75.6 and 66.1, respectively, in the previous month poll. But in a year, the rupee's expected performance is broadly in line with expectations for most currencies as the dollar's resurgence is predicted to fade. A majority, 27 of 48 analysts, said the risks were skewed more towards the rupee strengthening against the greenback over the next year.

No rebound for India's reeling rupee seen likely in coming year: Poll

The battered rupee rose 23 paise to 74.16 against the US dollar Wednesday after the American currency weakened overseas amid increased selling by exporters.&nbsp;&nbsp; &nbsp;

Besides, RBI's decision to inject Rs 12,000 crore liquidity into the system through the purchase of government bonds on October 11 to meet the festival season demand for funds also supported the recovery in rupee, dealers said.

A higher opening of domestic equity markets too aided the recovery in the domestic unit.

The benchmark BSE Sensex rose 110.20 points or 0.31 per cent, to 34,409.67 in opening trade.

At the forex market, the rupee strengthened by 23 paise to quote at 74.16 against the US dollar in early trade on fresh selling of the American currency by banks and exporters.

The rupee slumped by 33 paise to finish at a fresh lifetime low of 74.39 against the US dollar Tuesday on high crude oil prices, strengthening of the greenback and unabated foreign fund outflows.

Meanwhile, DIIs bought shares worth Rs 1,526 crore, while FIIs pulled out a net Rs 1,242 crore Tuesday, as per provisional stock exchange data.

The battered rupee rose 23 paise to 74.16 against the US dollar Wednesday after the American currency weakened overseas amid increased selling by exporters. Besides, RBI's decision to inject Rs 12,000 crore liquidity into the system through the purchase of government bonds on October 11 to meet the festival season demand for funds also supported the recovery in rupee, dealers said.

The battered rupee rose 23 paise to 74.16 against the US dollar Wednesday after the American currency weakened overseas amid increased selling by exporters. Besides, RBI's decision to inject Rs 12,000 crore liquidity into the system through the purchase of government bonds on October 11 to meet the festival season demand for funds also supported the recovery in rupee, dealers said. A higher opening of domestic equity markets too aided the recovery in the domestic unit. The benchmark BSE Sensex rose 110.20 points or 0.31 per cent, to 34,409.67 in opening trade. At the forex market, the rupee strengthened by 23 paise to quote at 74.16 against the US dollar in early trade on fresh selling of the American currency by banks and exporters. The rupee slumped by 33 paise to finish at a fresh lifetime low of 74.39 against the US dollar Tuesday on high crude oil prices, strengthening of the greenback and unabated foreign fund outflows. Meanwhile, DIIs bought shares worth Rs 1,526 crore, while FIIs pulled out a net Rs 1,242 crore Tuesday, as per provisional stock exchange data.

Rupee rises from record low, recovers 23 paise against US dollar

The rupee made a cautious recovery of 18 paise to 73.88 against the US dollar Tuesday on fresh selling of the American currency by banks and exporters.

Besides, the dollar's overseas weakness, easing global crude oil price and higher opening in the domestic stock market supported recovery in the domestic unit, traders said.

At the forex market, the local currency was trading 18 paise higher at 73.88 in early trade.

The International Monetary Fund's forecast of a growth rate of 7.3 per cent for India in the current year of 2018 and that of 7.4 per cent in 2019, too, boosted investor sentiment here.

In the previous session Monday, the rupee slumped 30 paise to finish at a fresh lifetime low of 74.06 against the US dollar.

Meanwhile, the benchmark Sensex rose by 72.04 points, or 0.21 per cent, to 34,546.42 in opening trade.

The rupee made a cautious recovery of 18 paise to 73.88 against the US dollar Tuesday on fresh selling of the American currency by banks and exporters. Besides, the dollar's overseas weakness, easing global crude oil price and higher opening in the domestic stock market supported recovery in the domestic unit, traders said.

The rupee made a cautious recovery of 18 paise to 73.88 against the US dollar Tuesday on fresh selling of the American currency by banks and exporters. Besides, the dollar's overseas weakness, easing global crude oil price and higher opening in the domestic stock market supported recovery in the domestic unit, traders said. At the forex market, the local currency was trading 18 paise higher at 73.88 in early trade. The International Monetary Fund's forecast of a growth rate of 7.3 per cent for India in the current year of 2018 and that of 7.4 per cent in 2019, too, boosted investor sentiment here. In the previous session Monday, the rupee slumped 30 paise to finish at a fresh lifetime low of 74.06 against the US dollar. Meanwhile, the benchmark Sensex rose by 72.04 points, or 0.21 per cent, to 34,546.42 in opening trade.

Rupee recovers 18 paise against US dollar at Rs 73.88

The rupee slumped by 33 paise to finish at a fresh lifetime low of 74.39 against the US dollar Tuesday on high crude oil prices, strengthening of the greenback and unabated foreign fund outflows.

At the Interbank Foreign Exchange (Forex), the rupee made a cautious recovery of 18 paise to 73.88 against the US dollar in early trade on fresh selling of the American currency by banks and exporters.

However, the domestic currency failed to sustain the momentum after Brent crude breached the USD 84 per barrel-mark again and the US dollar strengthened overseas.

It finally closed at 74.39 against the US dollar, down by 33 paise, marking its sixth straight session of decline.

On Monday, the domestic unit plummeted by 30 paise to close at record low of 74.06.

The rupee slumped by 33 paise to finish at a fresh lifetime low of 74.39 against the US dollar Tuesday on high crude oil prices, strengthening of the greenback and unabated foreign fund outflows.

The rupee slumped by 33 paise to finish at a fresh lifetime low of 74.39 against the US dollar Tuesday on high crude oil prices, strengthening of the greenback and unabated foreign fund outflows. At the Interbank Foreign Exchange (Forex), the rupee made a cautious recovery of 18 paise to 73.88 against the US dollar in early trade on fresh selling of the American currency by banks and exporters. However, the domestic currency failed to sustain the momentum after Brent crude breached the USD 84 per barrel-mark again and the US dollar strengthened overseas. It finally closed at 74.39 against the US dollar, down by 33 paise, marking its sixth straight session of decline. On Monday, the domestic unit plummeted by 30 paise to close at record low of 74.06.

Rupee slumps 33 paise to close at record low of 74.39

The rupee dropped by another 14 paise to 73.90 per dollar in early trade Monday as the US currency gained in global markets amid unabated foreign fund outflows.

The dollar strengthened after China's central bank eased its domestic policy to support the economy.

China's central bank said on Sunday that it was cutting the reserve requirement rations (RRRs) by 1 per cent from October 15 which will inject a net USD 109.2 billion in cash into the banking system, amid a deepening trade war with the US that has increased pressure on growth in the world's second-largest economy.

Forex dealers said the dollar's strength against major global currencies weighed on the rupee sentiment.

On Friday, the rupee had lost 18 paise to end at a record low of 73.76 after collapsing to a lifetime low of 74.23 (intra-day) after the RBI unexpectedly kept the policy rate unchanged.

Foreign investors have pulled out over Rs 9,300 crore (USD 1.3 billion) from the Indian capital markets in the last four trading sessions.

Meanwhile, the benchmark BSE Sensex continued to fall, losing another 67.72 points, or 0.20 per cent, to 34,309.27 in early trade Monday.&nbsp;

The rupee dropped by another 14 paise to 73.90 per dollar in early trade Monday as the US currency gained in global markets amid unabated foreign fund outflows. The dollar strengthened after China's central bank eased its domestic policy to support the economy.

The rupee dropped by another 14 paise to 73.90 per dollar in early trade Monday as the US currency gained in global markets amid unabated foreign fund outflows. The dollar strengthened after China's central bank eased its domestic policy to support the economy. China's central bank said on Sunday that it was cutting the reserve requirement rations (RRRs) by 1 per cent from October 15 which will inject a net USD 109.2 billion in cash into the banking system, amid a deepening trade war with the US that has increased pressure on growth in the world's second-largest economy. Forex dealers said the dollar's strength against major global currencies weighed on the rupee sentiment. On Friday, the rupee had lost 18 paise to end at a record low of 73.76 after collapsing to a lifetime low of 74.23 (intra-day) after the RBI unexpectedly kept the policy rate unchanged. Foreign investors have pulled out over Rs 9,300 crore (USD 1.3 billion) from the Indian capital markets in the last four trading sessions. Meanwhile, the benchmark BSE Sensex continued to fall, losing another 67.72 points, or 0.20 per cent, to 34,309.27 in early trade Monday.

Rupee falls 14 paise against US dollar in opening trade

The rupee slumped by 30 paise to finish at a fresh lifetime low of 74.06 against the US dollar Monday amid strengthening of the greenback and steady capital outflows.

The rupee had opened lower by 14 paisa against Friday's close of 73.76 in early trade as the US dollar strength against major global currencies weighed on the rupee sentiment.

At the Interbank Foreign Exchange (Forex) market, the local currency opened lower at 73.89 a dollar against its previous closing of 73.76.

It recovered to a high of 73.76, but failed to sustain the momentum and plunged to 74.10 and finally closed at 74.06, down by 30 paise, marking its fifth straight session of decline.

On Friday, the domestic unit plummeted by 18 paise to end at 73.76.

The rupee slumped by 30 paise to finish at a fresh lifetime low of 74.06 against the US dollar Monday amid strengthening of the greenback and steady capital outflows.

The rupee slumped by 30 paise to finish at a fresh lifetime low of 74.06 against the US dollar Monday amid strengthening of the greenback and steady capital outflows. The rupee had opened lower by 14 paisa against Friday's close of 73.76 in early trade as the US dollar strength against major global currencies weighed on the rupee sentiment. At the Interbank Foreign Exchange (Forex) market, the local currency opened lower at 73.89 a dollar against its previous closing of 73.76. It recovered to a high of 73.76, but failed to sustain the momentum and plunged to 74.10 and finally closed at 74.06, down by 30 paise, marking its fifth straight session of decline. On Friday, the domestic unit plummeted by 18 paise to end at 73.76.

Rupee slumps 30 paise to close at record low of 74.06

The rupee recovered 6 paise to 73.52 against the US dollar at the forex market Friday ahead of the RBI's monetary policy outcome amid fresh selling by exporters as the government stepped in to reduce oil prices, reported news agency PTI.

Dealers said besides fresh selling of the US dollar by exporters, the greenback's weakness against some currencies overseas supported the rupee, the report added.

The domestic currency closed at a record low of 73.58, down by 24 paise or 0.33 per cent on Thursday, marking its third straight session of losses.

Meanwhile, the benchmark BSE Sensex dropped by 231.16 points, or 0.66 per cent, to 34,938 in opening trade.

The rupee recovered 6 paise to 73.52 against the US dollar at the forex market Friday ahead of the RBI's monetary policy outcome amid fresh selling by exporters as the government stepped in to reduce oil prices, reported news agency PTI.

The rupee recovered 6 paise to 73.52 against the US dollar at the forex market Friday ahead of the RBI's monetary policy outcome amid fresh selling by exporters as the government stepped in to reduce oil prices, reported news agency PTI. Dealers said besides fresh selling of the US dollar by exporters, the greenback's weakness against some currencies overseas supported the rupee, the report added. The domestic currency closed at a record low of 73.58, down by 24 paise or 0.33 per cent on Thursday, marking its third straight session of losses. Meanwhile, the benchmark BSE Sensex dropped by 231.16 points, or 0.66 per cent, to 34,938 in opening trade.

Rupee recovers 6 paise against US dollar ahead of RBI policy outcome

The rupee skidded by 18 paise to finish at a fresh lifetime low of 73.76 against the US dollar Friday after the RBI unexpectedly kept the policy rate unchanged.

The domestic unit crashed below the 74-mark for the first time ever in intra-day trade on persistent capital outflows and high crude oil prices.&nbsp;

Markets were caught off guard as the Reserve Bank maintained status quo on the benchmark interest rate. However, the central bank warned that rising oil prices and tightening of global financial conditions pose substantial risks to growth and inflation.

It also changed its policy stance to 'calibrated tightening' from 'neutral'.

Meanwhile, RBI Governor Urjit Patel Friday reiterated that the domestic currency is still better than its emerging market peers and that the apex bank does not have a target for it.

"The rupee fall, in some respect, is moderate in comparison to several other emerging market peers," Patel said at the customary post-policy press meet.

"Our response to these unsettled conditions has been to ensure that foreign exchange market remains liquid with no undue volatility. There is no target or band around any particular level of exchange rate, which is determined by market forces demand and supply," the governor added.

A majority of the analysts and bankers were expecting the six-member Monetary Policy Committee (MPC) to raise interest rate by at least 0.25 per cent, while the developments over the last few days, especially the weakness in the rupee, had led to speculations that it could be even as high as 0.50 per cent.

Equity markets racked up heavy losses for the third straight session.

The BSE Sensex plunged 792.17 points to end at a near six-month low of 34,376.99, while the broader NSE Nifty dropped 282.80 points to 10,316.45.

At the Interbank Foreign Exchange (Forex) market, the local currency opened higher at 73.56 a dollar against its previous record closing low of 73.58.

It recovered to a high of 73.42, but failed to sustain the momentum and plunged to 74.23 after RBI's policy announcement.

It finally closed at 73.76, down by 18 paise or 0.24 per cent, marking its fourth straight session of decline.

On Thursday, the domestic unit plummeted by 24 paise to end at 73.58.

"The rupee has extended losses as the RBI monetary policy meeting has clearly disappointed the street. Market was expecting at least 25 bps repo rate hike and measures to stabilise the rupee.

"Given the sell-off in the domestic equities and higher crude oil prices, the rupee is now expected to move towards 75-76 levels in next couple of sessions," said Rushabh Maru - Research Analyst , Anand Rathi Shares and Stock Brokers.

Brent crude oil prices were trading at USD 84.36 per barrel, showing a dip of 0.26 per cent. &nbsp; &nbsp;

India's benchmark 10-year sovereign yield fell to 8.04 per cent. 
Foreign institutional investors remained net sellers, offloading equities worth Rs 3,370.14 crore Friday, provisional data showed.

"Rupee was caught off guard and weakened beyond 74, after RBI surprised markets by keeping rates unchanged. Given the rising oil and trade tensions, traders will bet on exports going up, to curb further weakening in the currency," said Anand James, Chief Market Strategist at Geojit Financial Services.

Meanwhile, the FBIL set the reference rate at 73.5809 for the US dollar and 84.6975 for the euro. The pound sterling also pegged higher at 95.8877 and 64.59 for 100 Japanese yen.

The rupee skidded by 18 paise to finish at a fresh lifetime low of 73.76 against the US dollar Friday after the RBI unexpectedly kept the policy rate unchanged. The domestic unit crashed below the 74-mark for the first time ever in intra-day trade on persistent capital outflows and high crude oil prices.

The rupee skidded by 18 paise to finish at a fresh lifetime low of 73.76 against the US dollar Friday after the RBI unexpectedly kept the policy rate unchanged. The domestic unit crashed below the 74-mark for the first time ever in intra-day trade on persistent capital outflows and high crude oil prices. Markets were caught off guard as the Reserve Bank maintained status quo on the benchmark interest rate. However, the central bank warned that rising oil prices and tightening of global financial conditions pose substantial risks to growth and inflation. It also changed its policy stance to 'calibrated tightening' from 'neutral'. Meanwhile, RBI Governor Urjit Patel Friday reiterated that the domestic currency is still better than its emerging market peers and that the apex bank does not have a target for it. "The rupee fall, in some respect, is moderate in comparison to several other emerging market peers," Patel said at the customary post-policy press meet. "Our response to these unsettled conditions has been to ensure that foreign exchange market remains liquid with no undue volatility. There is no target or band around any particular level of exchange rate, which is determined by market forces demand and supply," the governor added. A majority of the analysts and bankers were expecting the six-member Monetary Policy Committee (MPC) to raise interest rate by at least 0.25 per cent, while the developments over the last few days, especially the weakness in the rupee, had led to speculations that it could be even as high as 0.50 per cent. Equity markets racked up heavy losses for the third straight session. The BSE Sensex plunged 792.17 points to end at a near six-month low of 34,376.99, while the broader NSE Nifty dropped 282.80 points to 10,316.45. At the Interbank Foreign Exchange (Forex) market, the local currency opened higher at 73.56 a dollar against its previous record closing low of 73.58. It recovered to a high of 73.42, but failed to sustain the momentum and plunged to 74.23 after RBI's policy announcement. It finally closed at 73.76, down by 18 paise or 0.24 per cent, marking its fourth straight session of decline. On Thursday, the domestic unit plummeted by 24 paise to end at 73.58. "The rupee has extended losses as the RBI monetary policy meeting has clearly disappointed the street. Market was expecting at least 25 bps repo rate hike and measures to stabilise the rupee. "Given the sell-off in the domestic equities and higher crude oil prices, the rupee is now expected to move towards 75-76 levels in next couple of sessions," said Rushabh Maru - Research Analyst , Anand Rathi Shares and Stock Brokers. Brent crude oil prices were trading at USD 84.36 per barrel, showing a dip of 0.26 per cent. India's benchmark 10-year sovereign yield fell to 8.04 per cent. Foreign institutional investors remained net sellers, offloading equities worth Rs 3,370.14 crore Friday, provisional data showed. "Rupee was caught off guard and weakened beyond 74, after RBI surprised markets by keeping rates unchanged. Given the rising oil and trade tensions, traders will bet on exports going up, to curb further weakening in the currency," said Anand James, Chief Market Strategist at Geojit Financial Services. Meanwhile, the FBIL set the reference rate at 73.5809 for the US dollar and 84.6975 for the euro. The pound sterling also pegged higher at 95.8877 and 64.59 for 100 Japanese yen.

Rupee slumps to all-time low of 73.76 as RBI holds rate

On the day the rupee breached the 74-mark against the US dollar for the first time, RBI governor Urjit Patel Friday reiterated that the domestic currency is still better than its emerging market peers and that the apex bank does not have a target for it.

After the Reserve Bank of India (RBI) in its fourth bi-monthly policy this fiscal left the policy rates unchanged and ruled out a rate cut in the rest of the fiscal, the rupee plummeted to 74.13 against the dollar, after opening higher then its previous close at 73.52.

Admitting that the country has not been immune to global spillovers from external factors, Patel said, "The rupee fall, in some respect, is moderate in comparison to several other emerging market market peers."

Ruling out a target for the currency, he said, "Our response to these unsettled conditions has been to ensure that foreign exchange market remains liquid with no undue volatility. There is no target or band around any particular level of exchange rate, which is determined by market forces demand and supply."

Addressing the media after the customary post-policy presser, Patel said the rupee has experienced bouts of volatility since the monetary policy committee meeting in August.

By the end of September, the rupee has depreciated in nominal effective terms by 5.6 per cent since the end of March. In real effective term, the rupee fall has been at 5 per cent, the governor said, adding the foreign exchange reserves of USD 400.5 billion as of end September, are sufficient to finance 10 months of imports.

In absolute terms, the rupee is down around 17 per cent since January this year.

Forex reserves had touched a record of USD 426.028 billion in the week to April 13, 2018, but have been declining since then on account of RBI intervention in market to stem fall in the rupee.

On the day the rupee breached the 74-mark against the US dollar for the first time, RBI governor Urjit Patel Friday reiterated that the domestic currency is still better than its emerging market peers and that the apex bank does not have a target for it.

On the day the rupee breached the 74-mark against the US dollar for the first time, RBI governor Urjit Patel Friday reiterated that the domestic currency is still better than its emerging market peers and that the apex bank does not have a target for it. After the Reserve Bank of India (RBI) in its fourth bi-monthly policy this fiscal left the policy rates unchanged and ruled out a rate cut in the rest of the fiscal, the rupee plummeted to 74.13 against the dollar, after opening higher then its previous close at 73.52. Admitting that the country has not been immune to global spillovers from external factors, Patel said, "The rupee fall, in some respect, is moderate in comparison to several other emerging market market peers." Ruling out a target for the currency, he said, "Our response to these unsettled conditions has been to ensure that foreign exchange market remains liquid with no undue volatility. There is no target or band around any particular level of exchange rate, which is determined by market forces demand and supply." Addressing the media after the customary post-policy presser, Patel said the rupee has experienced bouts of volatility since the monetary policy committee meeting in August. By the end of September, the rupee has depreciated in nominal effective terms by 5.6 per cent since the end of March. In real effective term, the rupee fall has been at 5 per cent, the governor said, adding the foreign exchange reserves of USD 400.5 billion as of end September, are sufficient to finance 10 months of imports. In absolute terms, the rupee is down around 17 per cent since January this year. Forex reserves had touched a record of USD 426.028 billion in the week to April 13, 2018, but have been declining since then on account of RBI intervention in market to stem fall in the rupee.

Rupee at 74 to a dollar is still better than other emerging market peers: RBI governor Urjit Patel

The continuing downfall of Rupee has led to the Indian currency breaching the 74-mark against US dollar for the first time. The Reserve Bank of India (RBI), in a surprise move, kept the key rates unchanged which many analysts feel is the reason for Rupee's further fall.

The rupee has tanked 14 per cent against the dollar this year as investors withdraw from emerging markets.

The RBI raised rates in June and August in part to help shore up the currency, which started 2018 at 63.67 to the dollar.

The partially convertible rupee had hit a <a href="http://www.wionews.com/business-economy/rupee-crashes-to-all-time-low-of-7381-on-capital-outflows-surging-oil-prices-169479">life-time low</a> of 73.81 per dollar on Thursday before recovering to 73.62 later in the day.

Confidence has ebbed in India's markets in recent weeks. The rupee has set all-time lows, bonds are at their weakest since November 2014, and share markets have suffered a sharp correction after hitting record highs in August.

A liquidity scare erupted last month after a series of debt defaults by <a href="http://www.wionews.com/business-economy/new-board-to-consider-all-options-to-revive-ilfs-169502">Infrastructure Leasing &amp; Financial Services</a> (IL&amp;FS) sparked redemption pressure at other shadow banking companies.

And dollar selling by the RBI to support the rupee has put a further squeeze on rupee liquidity.

Rising global oil prices, they climbed two per cent on Wednesday to hit a four year-high, are bad news for importing nations like India.

The current account has faced additional pressure as India, like many emerging market economies, has also suffered due to rising US interest rates drawing investors away.

(With inputs from Reuters)

The continuing downfall of Rupee has led to the Indian currency breaching the 74-mark against US dollar for the first time. The Reserve Bank of India (RBI), in a surprise move, kept the key rates unchanged which many analysts feel is the reason for Rupee's further fall.

The continuing downfall of Rupee has led to the Indian currency breaching the 74-mark against US dollar for the first time. The Reserve Bank of India (RBI), in a surprise move, kept the key rates unchanged which many analysts feel is the reason for Rupee's further fall. The rupee has tanked 14 per cent against the dollar this year as investors withdraw from emerging markets. The RBI raised rates in June and August in part to help shore up the currency, which started 2018 at 63.67 to the dollar. The partially convertible rupee had hit a life-time low of 73.81 per dollar on Thursday before recovering to 73.62 later in the day. Confidence has ebbed in India's markets in recent weeks. The rupee has set all-time lows, bonds are at their weakest since November 2014, and share markets have suffered a sharp correction after hitting record highs in August. A liquidity scare erupted last month after a series of debt defaults by Infrastructure Leasing & Financial Services (IL&FS) sparked redemption pressure at other shadow banking companies. And dollar selling by the RBI to support the rupee has put a further squeeze on rupee liquidity. Rising global oil prices, they climbed two per cent on Wednesday to hit a four year-high, are bad news for importing nations like India. The current account has faced additional pressure as India, like many emerging market economies, has also suffered due to rising US interest rates drawing investors away. (With inputs from Reuters)

Rupee breaches 74-mark for first time as RBI keeps key rates unchanged

The rupee on Thursday crashed to a historic low of 73.81 to the dollar due to the twin-impact of capital outflows triggered by surging US Treasury yields and crude oil prices racing to a four-year high.

The domestic currency closed at a record low of 73.58, down by 24 paise or 0.33 per cent, marking its third straight session of losses. The rupee has lost 110 paise or 1.51 per cent in the three sessions since Monday largely due to strong demand dollar demand from oil importers amid firming oil prices and foreign capital outflows.

The US dollar strengthened against global peers after economic data signalled a thriving US economy which drove Treasury yields to a seven-year high of 3.23 per cent - a level not seen since mid-2011.

Hawkish comments about the US economy by Federal Reserve Chairman Jerome Powell have also boosted the dollar buying.

Emerging currencies including the rupee bore the brunt during the day as investors shifted funds from riskier assets to safe bets like the US dollar.

The dollar strengthened against the Chinese yuan by 0.2 per cent to 6.9 in the offshore market and touched a fresh 20-year high against the Indonesian rupiah. South African rand, Mexican peso and Australian dollar also dropped up to 1.5 per cent.

Brent crude also breached the four-year high of $86 dollar per barrel level, fuelling worries over widening current account and trade deficit.

Oil prices have reached four-year peaks as the market focused on upcoming US sanctions on Iran while shrugging off the year's largest weekly build in US crude stockpiles.

"The fall in the rupee led to a sharp rise in government bond yields, due to increasing expectations that the RBI's monetary policy committee (MPC) could go for a bigger rate increase than expected on Friday," V K Sharma, Head PCG &amp; Capital Markets Group HDFC Securities.

India's benchmark 10-year sovereign yield rose to 8.16 per cent.

Stocks markets crashed up to 2.24 per cent due to heavy selling pressure banking, energy, pharma and IT stocks.

Foreign investors remained net sellers for a third day pulling out Rs 2,760.63 crore from stock markets.

To stem the rupee fall, the RBI Wednesday allowed oil companies to access foreign capital of $10 billion on a long-term basis to finance their working capital requirements.

The government Thursday said state-owned fuel retailers will have to complete $10 billion external commercial borrowing (ECBs) within a year and they would not be required to hedge the exposure.

The central government and mostly BJP-led states announced a cut in excise and VAT rates to reduce fuel prices by Rs 5 per litre.

The rupee opened on a weak note at 73.72 against the previous close of 73.34 per dollar. It slid to an all-time low of 73.81 per dollar due to rising crude prices and reports that the RBI "cannot afford" a special swap window for oil importers to meet the dollar demand.

Bank of America Merrill Lynch in a report explained that pre-committing $8 billion a month for it over and above the $25-30 billion lost in interventions since April will push the overall forex reserves below the critical eight-month import cover mark.

The rupee, however, made a spirited recovery of 23 paise from lifetime lows in last 15 minutes of trade backed by the government steps to reduce oil prices. 
It finally settled at 73.58, it all-time closing low, with a loss of 24 paise.

The FBIL set the reference rate at 73.7509 for the US dollar and 84.6257 for the euro. The pound sterling was pegged at 95.3904 and Japanese yen at 64.49 for 100 rupees.&nbsp;

 
&nbsp;

The rupee on Thursday crashed to a historic low of 73.81 to the dollar due to the twin-impact of capital outflows triggered by surging US Treasury yields and crude oil prices racing to a four-year high.

The rupee on Thursday crashed to a historic low of 73.81 to the dollar due to the twin-impact of capital outflows triggered by surging US Treasury yields and crude oil prices racing to a four-year high. The domestic currency closed at a record low of 73.58, down by 24 paise or 0.33 per cent, marking its third straight session of losses. The rupee has lost 110 paise or 1.51 per cent in the three sessions since Monday largely due to strong demand dollar demand from oil importers amid firming oil prices and foreign capital outflows. The US dollar strengthened against global peers after economic data signalled a thriving US economy which drove Treasury yields to a seven-year high of 3.23 per cent - a level not seen since mid-2011. Hawkish comments about the US economy by Federal Reserve Chairman Jerome Powell have also boosted the dollar buying. Emerging currencies including the rupee bore the brunt during the day as investors shifted funds from riskier assets to safe bets like the US dollar. The dollar strengthened against the Chinese yuan by 0.2 per cent to 6.9 in the offshore market and touched a fresh 20-year high against the Indonesian rupiah. South African rand, Mexican peso and Australian dollar also dropped up to 1.5 per cent. Brent crude also breached the four-year high of $86 dollar per barrel level, fuelling worries over widening current account and trade deficit. Oil prices have reached four-year peaks as the market focused on upcoming US sanctions on Iran while shrugging off the year's largest weekly build in US crude stockpiles. "The fall in the rupee led to a sharp rise in government bond yields, due to increasing expectations that the RBI's monetary policy committee (MPC) could go for a bigger rate increase than expected on Friday," V K Sharma, Head PCG & Capital Markets Group HDFC Securities. India's benchmark 10-year sovereign yield rose to 8.16 per cent. Stocks markets crashed up to 2.24 per cent due to heavy selling pressure banking, energy, pharma and IT stocks. Foreign investors remained net sellers for a third day pulling out Rs 2,760.63 crore from stock markets. To stem the rupee fall, the RBI Wednesday allowed oil companies to access foreign capital of $10 billion on a long-term basis to finance their working capital requirements. The government Thursday said state-owned fuel retailers will have to complete $10 billion external commercial borrowing (ECBs) within a year and they would not be required to hedge the exposure. The central government and mostly BJP-led states announced a cut in excise and VAT rates to reduce fuel prices by Rs 5 per litre. The rupee opened on a weak note at 73.72 against the previous close of 73.34 per dollar. It slid to an all-time low of 73.81 per dollar due to rising crude prices and reports that the RBI "cannot afford" a special swap window for oil importers to meet the dollar demand. Bank of America Merrill Lynch in a report explained that pre-committing $8 billion a month for it over and above the $25-30 billion lost in interventions since April will push the overall forex reserves below the critical eight-month import cover mark. The rupee, however, made a spirited recovery of 23 paise from lifetime lows in last 15 minutes of trade backed by the government steps to reduce oil prices. It finally settled at 73.58, it all-time closing low, with a loss of 24 paise. The FBIL set the reference rate at 73.7509 for the US dollar and 84.6257 for the euro. The pound sterling was pegged at 95.3904 and Japanese yen at 64.49 for 100 rupees.

Rupee crashes to all-time low of 73.81 on capital outflows, surging oil prices

Indian stock markets closed in red on Thursday with BSE Sensex diving 806.47 points to close at 35,169.16 and Nifty sinking 259 points at 10,599.25, news agency PTI reported.&nbsp;

Markets today opened on a negative note, with the BSE benchmark Sensex cracking over 850 points in early session as the rupee hit another low amid weak global cues and fears of widening current account deficit.

The 50-share Nifty tumbled nearly 250 points to test the 10,600-mark during the day.&nbsp;

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<a href="https://twitter.com/hashtag/Sensex?src=hash&amp;ref_src=twsrc%5Etfw">#Sensex</a> down by 806.47 points, currently at 35,169.16; Nifty down by 259 points, currently at 10,599.25
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The rupee's plunge to a new record low of 73.72 against the dollar in early trade, too, weighed on investor mood.

Meanwhile, fuel prices across the country witnessed an unabated rise with petrol in Mumbai selling at Rs 91.34 per litre, while diesel rose to Rs 80.10 per litre. In Delhi, prices of petrol and diesel were hiked by 0.15 paise and 0.20 paise, respectively at Rs 84 per litre and Rs 75.45 per litre, respectively.&nbsp;

Union Finance Minister Arun Jaitley on Thursday noon announced relief to consumers by communicating government's decision to cut fuel prices by Rs 2.5.&nbsp;

According to the Finance Minister, while the excise duty has been cut by Rs 1.5, various oil marketing companies will also absorb Rs 1 giving a cumulative relief of Rs 2.5 on fuel prices to the consumers.

Indian stock markets closed in red on Thursday with BSE Sensex diving 806.47 points to close at 35,169.16 and Nifty sinking 259 points at 10,599.25, news agency PTI reported.

Indian stock markets closed in red on Thursday with BSE Sensex diving 806.47 points to close at 35,169.16 and Nifty sinking 259 points at 10,599.25, news agency PTI reported. Markets today opened on a negative note, with the BSE benchmark Sensex cracking over 850 points in early session as the rupee hit another low amid weak global cues and fears of widening current account deficit. The 50-share Nifty tumbled nearly 250 points to test the 10,600-mark during the day. #Sensex down by 806.47 points, currently at 35,169.16; Nifty down by 259 points, currently at 10,599.25 — ANI (@ANI) October 4, 2018 × The rupee's plunge to a new record low of 73.72 against the dollar in early trade, too, weighed on investor mood. Meanwhile, fuel prices across the country witnessed an unabated rise with petrol in Mumbai selling at Rs 91.34 per litre, while diesel rose to Rs 80.10 per litre. In Delhi, prices of petrol and diesel were hiked by 0.15 paise and 0.20 paise, respectively at Rs 84 per litre and Rs 75.45 per litre, respectively. Union Finance Minister Arun Jaitley on Thursday noon announced relief to consumers by communicating government's decision to cut fuel prices by Rs 2.5. According to the Finance Minister, while the excise duty has been cut by Rs 1.5, various oil marketing companies will also absorb Rs 1 giving a cumulative relief of Rs 2.5 on fuel prices to the consumers.

Markets close in red, Sensex tanks 806.47 points to close at 35,169.16  

The rupee Wednesday plunged by 43 paise to breach the historic low of 73 level as soaring crude oil prices fuelled worries over capital outflows and widening current account deficit.

The domestic currency closed at a record low of 73.34, down by 43 paise or 0.59 per cent at the interbank foreign exchange here.

In the day trade, the rupee crashed to its all-time low of 73.42 per dollar as crude oil prices breached the $85 per barrel mark, leading to huge outflows of cash.

Investors remained concerned over sustained foreign capital outflows and soaring crude oil prices, analysts said.

After breaching the US 85 per barrel level, the benchmark Brent crude stayed near four-year high levels at $84.86 per barrel.

According to the provisional exchange data, foreign investors withdrew Rs 1,550 crore on a net basis from capital markets on Wednesday.

Rising US interest rates and bond yields have encouraged investors to pull out funds from emerging markets to pocket better returns, analysts said.

"The rupee has made a new record low today on the back of consistent rise in the crude oil prices. A sharp rise in crude oil along with steep depreciation in the rupee might push inflation higher in coming months," Rushabh Maru - Research Analyst, Anand Rathi Shares and Stock Brokers.

The Reserve Bank refused to open a special window for oil marketing companies which affected market sentiments, VK Sharma, Head Private Client Group &amp; Capital Market Strategy at HDFC Securities.

Stocks also fell by more than 1.5 per cent due to the rupee falling to record low levels. The benchmark BSE Sensex plunged by 550 points or 1.51 per cent while the broader Nifty tanked 150 points or 1.38 per cent.

The rupee opened lower at 73.26 per dollar due to high crude oil prices against the last close of 72.91 per dollar. The currency pared some losses to touch a high of 72.90 per dollar on market speculation that RBI may open special dollar window for oil companies.

However, without any clear signals from the central bank, the rupee crashed to all-time lows before settling at 73.34.

Meanwhile, the FBIL set the reference rate for the dollar at 73.02 per dollar. The reference rate for euro was fixed at 84.57 against 84.37 previously and for the British pound at 94.98 against 94.88 on October 1.

The rupee Wednesday plunged by 43 paise to breach the historic low of 73 level as soaring crude oil prices fuelled worries over capital outflows and widening current account deficit.

The rupee Wednesday plunged by 43 paise to breach the historic low of 73 level as soaring crude oil prices fuelled worries over capital outflows and widening current account deficit. The domestic currency closed at a record low of 73.34, down by 43 paise or 0.59 per cent at the interbank foreign exchange here. In the day trade, the rupee crashed to its all-time low of 73.42 per dollar as crude oil prices breached the $85 per barrel mark, leading to huge outflows of cash. Investors remained concerned over sustained foreign capital outflows and soaring crude oil prices, analysts said. After breaching the US 85 per barrel level, the benchmark Brent crude stayed near four-year high levels at $84.86 per barrel. According to the provisional exchange data, foreign investors withdrew Rs 1,550 crore on a net basis from capital markets on Wednesday. Rising US interest rates and bond yields have encouraged investors to pull out funds from emerging markets to pocket better returns, analysts said. "The rupee has made a new record low today on the back of consistent rise in the crude oil prices. A sharp rise in crude oil along with steep depreciation in the rupee might push inflation higher in coming months," Rushabh Maru - Research Analyst, Anand Rathi Shares and Stock Brokers. The Reserve Bank refused to open a special window for oil marketing companies which affected market sentiments, VK Sharma, Head Private Client Group & Capital Market Strategy at HDFC Securities. Stocks also fell by more than 1.5 per cent due to the rupee falling to record low levels. The benchmark BSE Sensex plunged by 550 points or 1.51 per cent while the broader Nifty tanked 150 points or 1.38 per cent. The rupee opened lower at 73.26 per dollar due to high crude oil prices against the last close of 72.91 per dollar. The currency pared some losses to touch a high of 72.90 per dollar on market speculation that RBI may open special dollar window for oil companies. However, without any clear signals from the central bank, the rupee crashed to all-time lows before settling at 73.34. Meanwhile, the FBIL set the reference rate for the dollar at 73.02 per dollar. The reference rate for euro was fixed at 84.57 against 84.37 previously and for the British pound at 94.98 against 94.88 on October 1.

Rupee crashes below record 73 mark, ends lower by 43 amid oil price spike

The rupee dropped to a record low on Wednesday as a sharp rise in global crude oil prices heaped more pressure on the currency, prompting the central bank to quickly intervene to slow its fall.

The domestic currency slid 34 paise to a new record low of 73.25 against the US dollar in early morning trade.&nbsp;

The partially convertible rupee briefly traded stronger on the day at 72.90 per dollar against its previous close of 72.91 after the news report. It had touched a life low of 73.42 earlier in the session.

By 2:34 pm, the rupee was trading at 73.24 per dollar.

According to forex dealers, demand for the US currency from importers, along with a strong dollar overseas and rising crude oil prices, weighed heavily on the domestic currency.&nbsp;

The rupee has hit a series of record lows against the dollar in the past two months, weakening to about 73 rupees against the greenback.&nbsp;

That marked a decline of more than 14 per cent since the start of this year, earning it the status of the worst-performing in the region — alongside the Indonesian rupiah and Philippine peso.

The benchmark 10-year bond yield was up 6 basis points at 8.05 per cent.

Oil prices firmed on expectations of a tighter market once US&nbsp;sanctions start targeting Iran's petroleum industry from next month, although a strong dollar and rising US crude supply curbed gains. Prices, however, remain at highest levels since November 2014.&nbsp;

Experts say that broader global concerns, which rose to the forefront in the emerging currencies sell-off following economic troubles in Turkey and Argentina, have also weighed on investor sentiment.

(With inputs from agencies)

The rupee dropped to a record low on Wednesday as a sharp rise in global crude oil prices heaped more pressure on the currency, prompting the central bank to quickly intervene to slow its fall.

The rupee dropped to a record low on Wednesday as a sharp rise in global crude oil prices heaped more pressure on the currency, prompting the central bank to quickly intervene to slow its fall. The domestic currency slid 34 paise to a new record low of 73.25 against the US dollar in early morning trade. The partially convertible rupee briefly traded stronger on the day at 72.90 per dollar against its previous close of 72.91 after the news report. It had touched a life low of 73.42 earlier in the session. By 2:34 pm, the rupee was trading at 73.24 per dollar. According to forex dealers, demand for the US currency from importers, along with a strong dollar overseas and rising crude oil prices, weighed heavily on the domestic currency. The rupee has hit a series of record lows against the dollar in the past two months, weakening to about 73 rupees against the greenback. That marked a decline of more than 14 per cent since the start of this year, earning it the status of the worst-performing in the region — alongside the Indonesian rupiah and Philippine peso. The benchmark 10-year bond yield was up 6 basis points at 8.05 per cent. Oil prices firmed on expectations of a tighter market once US sanctions start targeting Iran's petroleum industry from next month, although a strong dollar and rising US crude supply curbed gains. Prices, however, remain at highest levels since November 2014. Experts say that broader global concerns, which rose to the forefront in the emerging currencies sell-off following economic troubles in Turkey and Argentina, have also weighed on investor sentiment. (With inputs from agencies)

Rupee hits new low, breaches 73 against dollar for first time

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