The Indian rupee crossed 79 against the US dollar amid rising fears of a recession. Agencies are predicting a Euro-zone recession in the last quarter of 2022. Are governments doing enough to curb this slowdown? Palki Sharma tells you.

Gravitas: Rupee hits record low against US dollar

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

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

Indian rupee slips to 78.68 against US dollar

The Indian rupee tumbled to a record low of 77.82 against the US dollar in opening trade on Friday during the intra-day trades.

At the interbank foreign exchange, the rupee opened on a weak note at 77.81 against the American dollar, before ending the session at 77.82.

On Thursday, the rupee fell by 6 paise to close at 77.74 against the US dollar. The previous low of 77.79 was touched on May 17.

It is being said that a spurt in the global price of Brent crude to over $124 per barrel might have caused the Indian currency to depreciate as even a slight rise in crude prices could severely impact India’s current account deficit.

According to Reuters, which has quoted traders, the rupee could weaken towards 79/dollar levels by end of fiscal year 2022/23 but the fall could be accelerated by firm crude oil prices.

India imports nearly 85 per cent of its oil requirements and high crude tends to push up domestic inflation while also widening the country’s trade and current account deficits.

Indian shares continued to incur losses to a fifth session as investors worried that aggressive policy tightening by central banks could stifle global economic growth.

RBI raised its key repo rate by 50 basis points on Wednesday.

Foreign funds have sold stocks worth more than $23 billion so far in 2022 while they are net sellers of $2.1 billion in debt.

Global oil benchmark Brent crude futures fell 0.66 per cent to USD 122.26 per barrel.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.04 per cent lower at 103.17.

On the domestic equity market front, the 30-share Sensex was trading 620.68 points or 1.12 per cent lower at 54,699.60, while the broader NSE Nifty declined 165.30 points or 1 per cent to 16,312.80.

(With inputs from agencies)

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The Indian rupee tumbled to a record low of 77.82 against the US dollar in opening trade on Friday during the intra-day trades. At the interbank foreign exchange, the rupee opened on a weak note at 77.

The Indian rupee tumbled to a record low of 77.82 against the US dollar in opening trade on Friday during the intra-day trades. At the interbank foreign exchange, the rupee opened on a weak note at 77.81 against the American dollar, before ending the session at 77.82. On Thursday, the rupee fell by 6 paise to close at 77.74 against the US dollar. The previous low of 77.79 was touched on May 17. It is being said that a spurt in the global price of Brent crude to over $124 per barrel might have caused the Indian currency to depreciate as even a slight rise in crude prices could severely impact India’s current account deficit. According to Reuters, which has quoted traders, the rupee could weaken towards 79/dollar levels by end of fiscal year 2022/23 but the fall could be accelerated by firm crude oil prices. India imports nearly 85 per cent of its oil requirements and high crude tends to push up domestic inflation while also widening the country’s trade and current account deficits. Indian shares continued to incur losses to a fifth session as investors worried that aggressive policy tightening by central banks could stifle global economic growth. RBI raised its key repo rate by 50 basis points on Wednesday. Foreign funds have sold stocks worth more than $23 billion so far in 2022 while they are net sellers of $2.1 billion in debt. Global oil benchmark Brent crude futures fell 0.66 per cent to USD 122.26 per barrel. Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.04 per cent lower at 103.17. On the domestic equity market front, the 30-share Sensex was trading 620.68 points or 1.12 per cent lower at 54,699.60, while the broader NSE Nifty declined 165.30 points or 1 per cent to 16,312.80. (With inputs from agencies) WATCH WION LIVE HERE

Indian rupee slides to record low of 77.82 against US dollar

The Pakistani rupee on Tuesday surpassed all prior records against the US dollar after shedding sheds Rs 2.77, or 1.37 per cent, against the US dollar in the interbank market.

It plummeted to an all-time low of 202.83 against the US dollar in the interbank market as demand increased due to oil-related payments and ambiguity regarding the revival of the multibillion, reported Geo News.

According to data released by the State Bank of Pakistan (SBP), the local currency surpassed its previous record low of Rs 202 recorded on May 26.

Also read |&nbsp;<a href="https://www.wionews.com/south-asia/right-to-inheritance-and-property-far-cry-for-women-in-pakistan-486100">Right to inheritance and property 'far cry' for women in Pakistan</a>

Moreover, for the first time in its history, the local currency made a historical drop of Rs 4.00 in a single day and surpassed Rs 204 threshold against the greenback in the interbank market during the intraday trade, reported Geo News.

Moreover, during the day the currency faced renewed pressure after foreign currency inflows from overseas Pakistanis through their Roshan Digital Account (RDA) dived to a 15-month low at USD 189 million in May 2022.

The market reversed the free fall and closed the day with a loss of nearly Rs 3.

This was the third consecutive workday free-fall of the rupee.In the open market, the rupee closed at a historic low of 204 against the greenback, according to the Forex Association of Pakistan.

Watch |&nbsp;Pakistan: Govt announces cost-cutting measures, launches austerity drive

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Speaking to Geo News, Arif Habib Limited Head of Research Tahir Abbas said the currency is under pressure due to pending oil payments and rising oil prices in the international market.

"The plunge came on the back of a mammoth import bill and widened the current account deficit," the analyst said.

Abbas added that the market is keeping a close eye on the developments regarding the International Monetary Fund (IMF) programme, which is expected to be revived after the announcement of the budget as the government is taking all possible steps to meet the conditions laid forth by the Fund.

The recent bearish spell began after the government hiked the price of petroleum products by a major Rs 60 per litre as a result of removing subsidies -- one of the main demands of the money lender.

Also read |&nbsp;<a href="https://www.wionews.com/south-asia/pakistan-needs-usd-41-billion-in-next-12-months-says-finance-minister-486098">Pakistan needs USD 41 billion in next 12 months, says finance minister</a>

Traders believe caution can be expected this week ahead of the unveiling of the federal budget for the fiscal year 2022-23 scheduled to be announced on June 10 (Friday), with investors expecting IMF conditions of fiscal consolidation to dominate.

Renewed pressure on the rupee on an increase in fiscal-year-end dollar demand from importers and the corporate sector will keep the local currency under pressure.

Since the beginning of this fiscal year (July 1, 2021) to date, the rupee has collectively dropped by a massive 30.65 per cent (or Rs 48.29) compared to the previous fiscal year`s close at Rs 157.54.

The rupee has maintained a downward trend for the last 13 months. It has lost 33.20 per cent (or Rs 50.56) to date, compared to the record high of Rs 152.27 recorded in May 2021.

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&nbsp;

The Pakistani rupee on Tuesday surpassed all prior records against the US dollar after shedding sheds Rs 2.77, or 1.37 per cent, against the US dollar in the interbank market.

The Pakistani rupee on Tuesday surpassed all prior records against the US dollar after shedding sheds Rs 2.77, or 1.37 per cent, against the US dollar in the interbank market. It plummeted to an all-time low of 202.83 against the US dollar in the interbank market as demand increased due to oil-related payments and ambiguity regarding the revival of the multibillion, reported Geo News. According to data released by the State Bank of Pakistan (SBP), the local currency surpassed its previous record low of Rs 202 recorded on May 26. Also read | Right to inheritance and property 'far cry' for women in Pakistan Moreover, for the first time in its history, the local currency made a historical drop of Rs 4.00 in a single day and surpassed Rs 204 threshold against the greenback in the interbank market during the intraday trade, reported Geo News. Moreover, during the day the currency faced renewed pressure after foreign currency inflows from overseas Pakistanis through their Roshan Digital Account (RDA) dived to a 15-month low at USD 189 million in May 2022. The market reversed the free fall and closed the day with a loss of nearly Rs 3. This was the third consecutive workday free-fall of the rupee.In the open market, the rupee closed at a historic low of 204 against the greenback, according to the Forex Association of Pakistan. Watch | Pakistan: Govt announces cost-cutting measures, launches austerity drive Speaking to Geo News, Arif Habib Limited Head of Research Tahir Abbas said the currency is under pressure due to pending oil payments and rising oil prices in the international market. "The plunge came on the back of a mammoth import bill and widened the current account deficit," the analyst said. Abbas added that the market is keeping a close eye on the developments regarding the International Monetary Fund (IMF) programme, which is expected to be revived after the announcement of the budget as the government is taking all possible steps to meet the conditions laid forth by the Fund. The recent bearish spell began after the government hiked the price of petroleum products by a major Rs 60 per litre as a result of removing subsidies -- one of the main demands of the money lender. Also read | Pakistan needs USD 41 billion in next 12 months, says finance minister Traders believe caution can be expected this week ahead of the unveiling of the federal budget for the fiscal year 2022-23 scheduled to be announced on June 10 (Friday), with investors expecting IMF conditions of fiscal consolidation to dominate. Renewed pressure on the rupee on an increase in fiscal-year-end dollar demand from importers and the corporate sector will keep the local currency under pressure. Since the beginning of this fiscal year (July 1, 2021) to date, the rupee has collectively dropped by a massive 30.65 per cent (or Rs 48.29) compared to the previous fiscal year`s close at Rs 157.54. The rupee has maintained a downward trend for the last 13 months. It has lost 33.20 per cent (or Rs 50.56) to date, compared to the record high of Rs 152.27 recorded in May 2021. WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

Pakistani rupee nosedives to all-time low of 202.83 against US dollar

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

Gravitas: Worst day for global markets since June 2020

The Pakistani rupee fell to a new low of 191 rupees to the dollar on Thursday, as the country's currency was shaken by a continuing political turmoil.

The rupee has been falling for months, but it plummeted in March after opposition parties filed a no-confidence vote against Prime Minister Imran Khan, which resulted in the national assembly being dissolved last week.

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The Pakistani rupee has lost 18 percent of its value versus the US dollar since July 2021.

Relationships with the US and the International Monetary Fund (IMF) are also crucial.

<a href="https://www.wionews.com/south-asia/no-trust-vote-against-imran-khan-heres-all-you-need-to-know-about-the-procedure-469533">Also read | No-trust vote against Imran Khan: Here's all you need to know about the procedure</a>

Pakistan has received a $6 billion rescue package from the International Monetary Fund (IMF) to help with its balance of payment problems in 2019.&nbsp;

Traders' advice causes panic purchasing in the market during periods of currency devaluation.

They persuade importers to buy more in a short period of time in order to meet their payment obligations, resulting in a dollar shortage in the market.

<a href="https://www.wionews.com/opinions-blogs/im-the-dim-how-pakistan-pm-imran-khan-turned-out-to-be-a-terrible-caricature-of-the-champion-cricketer-467848">Opinion | 'Im the dim': How Pakistan PM Imran Khan turned out to be a terrible caricature of the champion cricketer</a>

At the same time, they encourage exporters not to sell dollars and instead stockpile them in anticipation of further depreciation, which will reduce greenback supply, according to Geo News.&nbsp;

For the previous 11 months, the rupee has been on a downward trend.

It has lost 23.58 percent (or Rs35.91) since its all-time high of Rs152.27 in May 2021.

Watch | Gravitas: What will be Imran Khan's next step?

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&nbsp;

(With inputs from agencies)

The Pakistani rupee fell to a new low of 191 rupees to the dollar on Thursday, as the country's currency was shaken by a continuing political turmoil. The rupee has been falling for months, but it plummeted in March after opposition parties filed a no-confidence vote against Prime Minister Imran Khan, which resulted in the national assembly being dissolved last week.

The Pakistani rupee fell to a new low of 191 rupees to the dollar on Thursday, as the country's currency was shaken by a continuing political turmoil. The rupee has been falling for months, but it plummeted in March after opposition parties filed a no-confidence vote against Prime Minister Imran Khan, which resulted in the national assembly being dissolved last week. Today the Pakistani rupee was trading at 186.28 on the open market. × The Pakistani rupee has lost 18 percent of its value versus the US dollar since July 2021. Relationships with the US and the International Monetary Fund (IMF) are also crucial. Also read | No-trust vote against Imran Khan: Here's all you need to know about the procedure Pakistan has received a $6 billion rescue package from the International Monetary Fund (IMF) to help with its balance of payment problems in 2019. Traders' advice causes panic purchasing in the market during periods of currency devaluation. They persuade importers to buy more in a short period of time in order to meet their payment obligations, resulting in a dollar shortage in the market. Opinion | 'Im the dim': How Pakistan PM Imran Khan turned out to be a terrible caricature of the champion cricketer At the same time, they encourage exporters not to sell dollars and instead stockpile them in anticipation of further depreciation, which will reduce greenback supply, according to Geo News. For the previous 11 months, the rupee has been on a downward trend. It has lost 23.58 percent (or Rs35.91) since its all-time high of Rs152.27 in May 2021. Watch | Gravitas: What will be Imran Khan's next step? (With inputs from agencies)

187 to a US dollar: Political crisis in Pakistan led to the free fall of its currency

The Pakistani rupee fell further against the US dollar on Monday, reaching a new low against the greenback during intra-day trade in the inter-bank market.

The Pakistani rupee continued to fall, losing another 82 paisas versus the US dollar, which was trading at Rs173 in intra-day trading in the inter-bank market.

Prime Minister Imran Khan stated last week at the opening of the Kisan Portal that the pressure on the Pakistani currency is transitory and would end shortly.&nbsp;

Since May, the Pakistani rupee has been gradually falling.

According to analysts, the rupee has been harmed by persistently high demand for dollars as a result of the country's current account deficit, while the Afghan crisis is putting further strain on the currency.&nbsp;

Since 1948, the Pakistani rupee has served as the country's official currency.

The central bank, the State Bank of Pakistan, issues and controls the coins and notes.&nbsp;

(With inputs from agencies)

The Pakistani rupee fell further against the US dollar on Monday, reaching a new low against the greenback during intra-day trade in the inter-bank market. The Pakistani rupee continued to fall, losing another 82 paisas versus the US dollar, which was trading at Rs173 in intra-day trading in the inter-bank market.

The Pakistani rupee fell further against the US dollar on Monday, reaching a new low against the greenback during intra-day trade in the inter-bank market. The Pakistani rupee continued to fall, losing another 82 paisas versus the US dollar, which was trading at Rs173 in intra-day trading in the inter-bank market. Prime Minister Imran Khan stated last week at the opening of the Kisan Portal that the pressure on the Pakistani currency is transitory and would end shortly. Since May, the Pakistani rupee has been gradually falling. According to analysts, the rupee has been harmed by persistently high demand for dollars as a result of the country's current account deficit, while the Afghan crisis is putting further strain on the currency. Since 1948, the Pakistani rupee has served as the country's official currency. The central bank, the State Bank of Pakistan, issues and controls the coins and notes. (With inputs from agencies)

$1=PKR 173: Pakistani rupee hit an all-time low against the US dollar

Gold prices held steady on Tuesday, as concerns over a potential fallout of Chinese property developer Evergrande`s unsolved debt crisis provided some respite to the safe-haven metal against a firmer dollar and elevated U.S. Treasury yields.

Spot gold was steady at $1,749.86 per ounce by 0454 GMT, while U.S. gold futures edged 0.1% down to $1,749.80.

"Gold seems content to range between $1,740 and $1,760 at the moment with Asian buyers adding to longs on dips with Evergrande and China growth fears encouraging regional buyers to add more weight in gold as a haven play," Jeffrey Halley, senior market analyst for Asia Pacific at OANDA said.

Investors continued to fret over China Evergrande Group, which has 30 days to make the payment before it falls into default while its wealth management unit is now being investigated.

But, bullion prices were capped by a stronger dollar and higher benchmark U.S. 10-year Treasury yields that hovered near a three-month peak.

Investors now eye Congressional testimony from U.S. Federal Reserve Chair Jerome Powell due later in the day, after he said the central bank would move against unchecked inflation if needed.

U.S. central bank officials also tied reduction in Federal Reserve`s monthly bond purchases to continued job growth, with a September employment report now a potential trigger for the central bank`s bond "taper."

While gold is often considered a hedge against higher inflation, a rate hike would increase the opportunity cost of holding gold, which pays no interest.

Holdings of SPDR Gold Trust, the world`s largest gold-backed exchange-traded fund, fell 0.3% to 990.32 on Monday.

Silver fell 0.3% to $22.59 an ounce.

Platinum was flat at $980.62, while palladium rose 0.2% to $1,968.83.

(Reporting by Eileen Soreng in Bengaluru; Editing by Ramakrishnan M., Rashmi Aich and Sherry Jacob-Phillips)

Gold prices held steady on Tuesday, as concerns over a potential fallout of Chinese property developer Evergrande`s unsolved debt crisis provided some respite to the safe-haven metal against a firmer dollar and elevated U.

Gold prices held steady on Tuesday, as concerns over a potential fallout of Chinese property developer Evergrande`s unsolved debt crisis provided some respite to the safe-haven metal against a firmer dollar and elevated U.S. Treasury yields. Spot gold was steady at $1,749.86 per ounce by 0454 GMT, while U.S. gold futures edged 0.1% down to $1,749.80. "Gold seems content to range between $1,740 and $1,760 at the moment with Asian buyers adding to longs on dips with Evergrande and China growth fears encouraging regional buyers to add more weight in gold as a haven play," Jeffrey Halley, senior market analyst for Asia Pacific at OANDA said. Investors continued to fret over China Evergrande Group, which has 30 days to make the payment before it falls into default while its wealth management unit is now being investigated. But, bullion prices were capped by a stronger dollar and higher benchmark U.S. 10-year Treasury yields that hovered near a three-month peak. Investors now eye Congressional testimony from U.S. Federal Reserve Chair Jerome Powell due later in the day, after he said the central bank would move against unchecked inflation if needed. U.S. central bank officials also tied reduction in Federal Reserve`s monthly bond purchases to continued job growth, with a September employment report now a potential trigger for the central bank`s bond "taper." While gold is often considered a hedge against higher inflation, a rate hike would increase the opportunity cost of holding gold, which pays no interest. Holdings of SPDR Gold Trust, the world`s largest gold-backed exchange-traded fund, fell 0.3% to 990.32 on Monday. Silver fell 0.3% to $22.59 an ounce. Platinum was flat at $980.62, while palladium rose 0.2% to $1,968.83. (Reporting by Eileen Soreng in Bengaluru; Editing by Ramakrishnan M., Rashmi Aich and Sherry Jacob-Phillips)

Gold holds firm as Evergrande crisis offsets firmer dollar, yields

The Indian rupee slumped 27 paise to 73.17 against the US dollar in opening trade on Wednesday tracking weak domestic equities and strong American currency.

At the interbank foreign exchange, the domestic unit opened lower at 73.13 against the dollar, and lost further ground and touched 73.17, registering a fall of 27 paise over its previous close. On Tuesday, the rupee had settled at 72.90 against the US dollar.

"The course ahead for the currency could remain uneven amid uncertainties around the development of the pandemic situation and the economic recovery," Reliance Securities said in a research note.

Most Asian currencies have started flat to weaker against the US dollar this morning and could weigh on the local unit, the note added.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.08 per cent to 89.90. Global oil benchmark Brent crude futures rose 0.24 per cent to USD 70.42 per barrel. On the domestic equity market front, BSE Sensex was trading 354.99 points or 0.68 per cent lower at 51,579.89, while the broader NSE Nifty fell 83.90 points or 0.54 per cent to 15,490.95.

Foreign institutional investors were net sellers in the capital market on Tuesday as they offloaded shares worth Rs 449.86 crore, as per exchange data.

Meanwhile, India reported 1,32,788 new coronavirus infections taking the country's tally of COVID-19 cases to 2,83,07,832, while the daily positivity rate has further dropped to 6.57 per cent, according to the Union Health Ministry data updated on Wednesday.

The Indian rupee slumped 27 paise to 73.17 against the US dollar in opening trade on Wednesday tracking weak domestic equities and strong American currency. At the interbank foreign exchange, the domestic unit opened lower at 73.

The Indian rupee slumped 27 paise to 73.17 against the US dollar in opening trade on Wednesday tracking weak domestic equities and strong American currency. At the interbank foreign exchange, the domestic unit opened lower at 73.13 against the dollar, and lost further ground and touched 73.17, registering a fall of 27 paise over its previous close. On Tuesday, the rupee had settled at 72.90 against the US dollar. "The course ahead for the currency could remain uneven amid uncertainties around the development of the pandemic situation and the economic recovery," Reliance Securities said in a research note. Most Asian currencies have started flat to weaker against the US dollar this morning and could weigh on the local unit, the note added. Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.08 per cent to 89.90. Global oil benchmark Brent crude futures rose 0.24 per cent to USD 70.42 per barrel. On the domestic equity market front, BSE Sensex was trading 354.99 points or 0.68 per cent lower at 51,579.89, while the broader NSE Nifty fell 83.90 points or 0.54 per cent to 15,490.95. Foreign institutional investors were net sellers in the capital market on Tuesday as they offloaded shares worth Rs 449.86 crore, as per exchange data. Meanwhile, India reported 1,32,788 new coronavirus infections taking the country's tally of COVID-19 cases to 2,83,07,832, while the daily positivity rate has further dropped to 6.57 per cent, according to the Union Health Ministry data updated on Wednesday.

Rupee falls 27 paise to 73.17 against US dollar in early trade

The Indian rupee ended 3 paise lower at 72.87 against the US dollar on Thursday amid a firm trend in the domestic equity markets.&nbsp;

At the interbank forex market, the local unit opened at 72.81 against the greenback and witnessed an intra-day high of 72.65 and a low of 72.87.&nbsp;

It finally ended at 72.87 against the American currency, registering a fall of 3 paise over its previous close.&nbsp;

On Wednesday, the rupee had finished at 72.84. The dollar index, which gauges the greenback's strength against a basket of six currencies, inched up 0.02 per cent to 90.38.&nbsp;

On the domestic equity market front, the BSE Sensex ended 222.13 points or 0.43 per cent higher at its all-time high of 51,531.52.&nbsp;

Similarly, the broader NSE Nifty advanced 66.80 points or 0.44 per cent to a record 15,173.30. Foreign institutional investors remained net buyers in the capital market as they purchased shares worth Rs 1,786.97 crore on Wednesday, according to exchange data.&nbsp;

Brent crude futures, the global oil benchmark, fell 0.70 per cent to USD 61.04 per barrel.&nbsp;

"The Indian Rupee ended flat against the US dollar, as possible intervention from RBI offset the impact of foreign flows in local equities," said Sriram Iyer, Senior Research Analyst at Reliance Securities.&nbsp;

The local unit had strengthened earlier in the session amid equity purchases by foreign investors which continued to remain buoyant over the last three months, Iyer said. The next trigger for the market could be the CPI and IIP data due on Friday, traders said.&nbsp;

"On the domestic front, market participants will be keeping an eye on inflation and industrial production number and better-than-estimates number could extend gains for the currency. "Today, volatility for the dollar could remain low as no major economic data is expected to be released from the US," said Gaurang Somaiyaa, Forex &amp; Bullion Analyst, Motilal Oswal Financial Services. Somaiyaa further added that "we expect the USD-INR (Spot) to quote sideways with a lower bias and in the range of 72.70 and 73.25."

The Indian rupee ended 3 paise lower at 72.87 against the US dollar on Thursday amid a firm trend in the domestic equity markets. At the interbank forex market, the local unit opened at 72.

The Indian rupee ended 3 paise lower at 72.87 against the US dollar on Thursday amid a firm trend in the domestic equity markets. At the interbank forex market, the local unit opened at 72.81 against the greenback and witnessed an intra-day high of 72.65 and a low of 72.87. It finally ended at 72.87 against the American currency, registering a fall of 3 paise over its previous close. On Wednesday, the rupee had finished at 72.84. The dollar index, which gauges the greenback's strength against a basket of six currencies, inched up 0.02 per cent to 90.38. On the domestic equity market front, the BSE Sensex ended 222.13 points or 0.43 per cent higher at its all-time high of 51,531.52. Similarly, the broader NSE Nifty advanced 66.80 points or 0.44 per cent to a record 15,173.30. Foreign institutional investors remained net buyers in the capital market as they purchased shares worth Rs 1,786.97 crore on Wednesday, according to exchange data. Brent crude futures, the global oil benchmark, fell 0.70 per cent to USD 61.04 per barrel. "The Indian Rupee ended flat against the US dollar, as possible intervention from RBI offset the impact of foreign flows in local equities," said Sriram Iyer, Senior Research Analyst at Reliance Securities. The local unit had strengthened earlier in the session amid equity purchases by foreign investors which continued to remain buoyant over the last three months, Iyer said. The next trigger for the market could be the CPI and IIP data due on Friday, traders said. "On the domestic front, market participants will be keeping an eye on inflation and industrial production number and better-than-estimates number could extend gains for the currency. "Today, volatility for the dollar could remain low as no major economic data is expected to be released from the US," said Gaurang Somaiyaa, Forex & Bullion Analyst, Motilal Oswal Financial Services. Somaiyaa further added that "we expect the USD-INR (Spot) to quote sideways with a lower bias and in the range of 72.70 and 73.25."

Rupee slips 3 paise to 72.87 against US dollar

Sri Lanka has repaid a billion US dollar international sovereign bond (ISB) that was due for settlement this week, the Central Bank said on Saturday.

The ISB repayment on Friday came days after Moody's on Monday downgraded Lanka's sovereign credit rating by two notches, saying the South Asian nation would be hard-pressed to secure funding to service its huge foreign debt.

Sri Lanka was pushed down from "B2" (high credit risk) to "Caa1" (very high credit risk), as the coronavirus pandemic compounded the economic woes of the island nation.

"This settlement reconfirms the government's unwavering commitment to honour its foreign liabilities, thereby bolstering investor confidence and dispelling any concerns foreign investors may have in relation to the government's ability and willingness to maintain its unblemished debt servicing record,? the Central Bank said in a statement.

"The domestic foreign exchange market has already reacted positively to this settlement and other recent positive developments in the Sri Lankan economy.

Also Read | <a href="https://www.wionews.com/south-asia/pay-firefighting-bill-before-leaving-sri-lanka-tells-stricken-oil-tanker-331978">Pay firefighting bill before leaving, Sri Lanka tells stricken oil tanker</a>

"With the envisaged inflows to the domestic foreign exchange market supported by proactive measures taken by the government and the Central Bank of Sri Lanka, the market sentiment is expected to further strengthen in the period ahead,? it said.

The Sri Lankan government said with the settlement of the one billion dollar ISB, the country now has no large debt payments before July 2021.

The government had dismissed the downgrade by Moody's as premature and unfair.

The government defended its ability to meet its debt repayments, citing a currency swap with India's RBI (Reserve Bank of India) and anticipated Japanese and Chinese bonds, in addition to a syndicated loan from China.

The Moody's had said Sri Lanka only had limited secured funding sources to meet its material external debt service payments over the coming years.

Following Moody's downgrading of Lanka's sovereign credit, the Opposition parties called for urgent economic reforms through collective efforts. 
&nbsp;

Sri Lanka has repaid a billion US dollar international sovereign bond (ISB) that was due for settlement this week, the Central Bank said on Saturday. The ISB repayment on Friday came days after Moody's on Monday downgraded Lanka's sovereign credit rating by two notches, saying the South Asian nation would be hard-pressed to secure funding to service its huge foreign debt.

Sri Lanka has repaid a billion US dollar international sovereign bond (ISB) that was due for settlement this week, the Central Bank said on Saturday. The ISB repayment on Friday came days after Moody's on Monday downgraded Lanka's sovereign credit rating by two notches, saying the South Asian nation would be hard-pressed to secure funding to service its huge foreign debt. Sri Lanka was pushed down from "B2" (high credit risk) to "Caa1" (very high credit risk), as the coronavirus pandemic compounded the economic woes of the island nation. "This settlement reconfirms the government's unwavering commitment to honour its foreign liabilities, thereby bolstering investor confidence and dispelling any concerns foreign investors may have in relation to the government's ability and willingness to maintain its unblemished debt servicing record,? the Central Bank said in a statement. "The domestic foreign exchange market has already reacted positively to this settlement and other recent positive developments in the Sri Lankan economy. Also Read | Pay firefighting bill before leaving, Sri Lanka tells stricken oil tanker "With the envisaged inflows to the domestic foreign exchange market supported by proactive measures taken by the government and the Central Bank of Sri Lanka, the market sentiment is expected to further strengthen in the period ahead,? it said. The Sri Lankan government said with the settlement of the one billion dollar ISB, the country now has no large debt payments before July 2021. The government had dismissed the downgrade by Moody's as premature and unfair. The government defended its ability to meet its debt repayments, citing a currency swap with India's RBI (Reserve Bank of India) and anticipated Japanese and Chinese bonds, in addition to a syndicated loan from China. The Moody's had said Sri Lanka only had limited secured funding sources to meet its material external debt service payments over the coming years. Following Moody's downgrading of Lanka's sovereign credit, the Opposition parties called for urgent economic reforms through collective efforts.

Sri Lanka repays billion US dollar sovereign bond

China wants to be the financial superpower and it is leaving no stone unturned in its quest to replace the U.S. Dollar with the Yuan as the global currency. Where does India stand in this race? On Gravitas Plus, Palki Sharma has the details.

Gravitas Plus: Does the Yuan pose a threat to the U.S. Dollar?

Communist-run Cuba will soon devalue the peso’s one-to-one exchange rate with the US dollar for the first time since the 1959 revolution, according to three sources who requested anonymity due to the sensitivity of the subject.

Cuba plans first official peso devaluation since 1959 revolution | Sources

Digital assets and cryptocurrencies like bitcoin, ethereum and XRP have often been called highly volatile and risky assets used by either speculators or dubious characters for dark web anonymous transactions facilitating illegal activities. Bitcoin has been around for over ten years at this point and it has proven to be useful for more than just speculation, and when it comes to using it for illegal transactions, it is not a clever solution to use a payment where the payment history is ending up on a permanent blockchain freely accessible.

The industries and companies that are developing technology using blockchain are now numbering in the thousands, and with more and more incentive to solve problems with fiat currencies, the industry is set to expand exponentially in the coming years. A fundamental difference between regular fiat currencies like the dollar, and bitcoin, is that the dollar is an inflationary currency that loses value over time due to money printing. Bitcoin, on the other hand, is a deflationary currency with a fixed, limited total supply.

Another characteristic of bitcoin besides the limited supply is the periodic halving of the reward handed out to miners processing transactions on the network and in turn increase the security of it. Currently, miners are rewarded with 12.5 bitcoins per block of transactions confirmed on the network, after the halving the reward will be reduced to 6.25 bitcoins per block. The next bitcoin halving is scheduled to happen on May 12, and investors are expecting that the digital asset will see new all-time highs as there will be a smaller supply of newly created Bitcoins.

When bitcoin halvings have happened historically, it has lead to a bull-market pushing the price of Bitcoin up dramatically in the months following the halving, which takes place roughly every four years.

Twitter handle PlanB @100trillionUSD has created a useful data model to explain these periodic cycles of price fluctuations in relation to the halving events: 
 
<img alt="Data Model" data-entity-type="file" data-entity-uuid="62d444e9-f7c6-4a9f-aae1-65abf35197fb" src="//cdn.wionews.com/sites/default/files/inline-images/medium_Com_PlanB_S2F_model%20%281%29.png" />

This model predicts that following the halving event on May 12, the price of bitcoin will rise into a new phase around $100,000 after the flow of new bitcoins into the market gets factored in and reflected into the price. The different phases of this model also take into consideration how the use case for bitcoin develops over time. In the early days, the most popular bitcoin narrative was “proof of concept”, in the next phase that changed to “payments”, followed by “E-gold” where the price of one bitcoin was close to the price of one ounce of gold. This model has proven its value over the previous halvings on the network, but it is worth noting that some of the scaling issues that appeared during the bull-market of 2017 are yet to be resolved.

Twitter user @C3_Nik states: “The Scalability issues surrounding #Bitcoin $BTC haven't been improved over the last few years. Nothing in terms of the technology has changed since the BTC network slowed down to a crawl and the average fee rose to 60$ in late 2017. It can kill the next bull run for BTC, easily.”

During all-time high bull-market of 2017, the network slowed down significantly, while the transaction fees rose to levels above what most people are comfortable with for smaller transactions, leading to a lot of investments flowing into altcoins where transactions were faster and cheaper.

@C3_Nik goes on to state “And this isn't some 'maybe', it is a proven fact. The data is there. Next time it will happen again. #Bitcoin $BTC will become unusable right in the middle of the next bull run. What will happen then? I hope that the market realises that there are better solutions that work.”

In the years following the launch of bitcoin, several other cryptocurrencies have been launched. One notable example is Ripple's XRP that focuses on international remittances and on-demand liquidity. While some people in the digital assets community think of Ripple as the banker's coin that does not follow the ethos of Bitcoin, Ripple labs went to meet with regulators as soon as possible in order to work with regulators and speed up the process of adoption and implementation. XRP is today the third biggest digital asset by market cap and has partnerships with more than 300 banks around the world. With all the developments in the recent months with the coronavirus pandemic and the economic fall out of that, there is now an added incentive for people to use digital payments instead of using cash due to the risk of getting infected. When the governments around the world are printing money on a large scale leading to inflation and the devaluing of their population's savings and retirements accounts, digital assets can, like gold and silver be used as a safe haven investment for protecting their wealth.

Whether or not the stock to flow model holds true and bitcoin reaches $100,000, the cryptocurrency industry is here to stay, and there are many other solutions than Bitcoin for secure digital payments. During these testing times, the future looks bright for digital assets.

(Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL) 
&nbsp;&nbsp;

&nbsp;

Digital assets and cryptocurrencies like bitcoin, ethereum and XRP have often been called highly volatile and risky assets used by either speculators or dubious characters for dark web anonymous transactions facilitating illegal activities.

Digital assets and cryptocurrencies like bitcoin, ethereum and XRP have often been called highly volatile and risky assets used by either speculators or dubious characters for dark web anonymous transactions facilitating illegal activities. Bitcoin has been around for over ten years at this point and it has proven to be useful for more than just speculation, and when it comes to using it for illegal transactions, it is not a clever solution to use a payment where the payment history is ending up on a permanent blockchain freely accessible. The industries and companies that are developing technology using blockchain are now numbering in the thousands, and with more and more incentive to solve problems with fiat currencies, the industry is set to expand exponentially in the coming years. A fundamental difference between regular fiat currencies like the dollar, and bitcoin, is that the dollar is an inflationary currency that loses value over time due to money printing. Bitcoin, on the other hand, is a deflationary currency with a fixed, limited total supply. Another characteristic of bitcoin besides the limited supply is the periodic halving of the reward handed out to miners processing transactions on the network and in turn increase the security of it. Currently, miners are rewarded with 12.5 bitcoins per block of transactions confirmed on the network, after the halving the reward will be reduced to 6.25 bitcoins per block. The next bitcoin halving is scheduled to happen on May 12, and investors are expecting that the digital asset will see new all-time highs as there will be a smaller supply of newly created Bitcoins. When bitcoin halvings have happened historically, it has lead to a bull-market pushing the price of Bitcoin up dramatically in the months following the halving, which takes place roughly every four years. Twitter handle PlanB @100trillionUSD has created a useful data model to explain these periodic cycles of price fluctuations in relation to the halving events: This model predicts that following the halving event on May 12, the price of bitcoin will rise into a new phase around $100,000 after the flow of new bitcoins into the market gets factored in and reflected into the price. The different phases of this model also take into consideration how the use case for bitcoin develops over time. In the early days, the most popular bitcoin narrative was “proof of concept”, in the next phase that changed to “payments”, followed by “E-gold” where the price of one bitcoin was close to the price of one ounce of gold. This model has proven its value over the previous halvings on the network, but it is worth noting that some of the scaling issues that appeared during the bull-market of 2017 are yet to be resolved. Twitter user @C3_Nik states: “The Scalability issues surrounding #Bitcoin $BTC haven't been improved over the last few years. Nothing in terms of the technology has changed since the BTC network slowed down to a crawl and the average fee rose to 60$ in late 2017. It can kill the next bull run for BTC, easily.” During all-time high bull-market of 2017, the network slowed down significantly, while the transaction fees rose to levels above what most people are comfortable with for smaller transactions, leading to a lot of investments flowing into altcoins where transactions were faster and cheaper. @C3_Nik goes on to state “And this isn't some 'maybe', it is a proven fact. The data is there. Next time it will happen again. #Bitcoin $BTC will become unusable right in the middle of the next bull run. What will happen then? I hope that the market realises that there are better solutions that work.” In the years following the launch of bitcoin, several other cryptocurrencies have been launched. One notable example is Ripple's XRP that focuses on international remittances and on-demand liquidity. While some people in the digital assets community think of Ripple as the banker's coin that does not follow the ethos of Bitcoin, Ripple labs went to meet with regulators as soon as possible in order to work with regulators and speed up the process of adoption and implementation. XRP is today the third biggest digital asset by market cap and has partnerships with more than 300 banks around the world. With all the developments in the recent months with the coronavirus pandemic and the economic fall out of that, there is now an added incentive for people to use digital payments instead of using cash due to the risk of getting infected. When the governments around the world are printing money on a large scale leading to inflation and the devaluing of their population's savings and retirements accounts, digital assets can, like gold and silver be used as a safe haven investment for protecting their wealth. Whether or not the stock to flow model holds true and bitcoin reaches $100,000, the cryptocurrency industry is here to stay, and there are many other solutions than Bitcoin for secure digital payments. During these testing times, the future looks bright for digital assets. (Disclaimer: The opinions expressed above are the personal views of the author and do not reflect the views of ZMCL)

Explained: Bitcoin halving and the expected bull-market for digital assets

The rupee on Wednesday recovered from record low levels to settle higher by 15 paise at 76.68 (provisional) against the US dollar following gains in domestic stocks and some weakness in the greenback against global currencies.

The rupee opened weak at 76.86 at the interbank forex market and then fell further to an all-time low of 76.88 during the day.

Later, the domestic unit recovered the lost ground in line with surging stock markets and finally settled at 76.68, higher by 15 paise over its last close of 76.83 against the US dollar.

Indian stocks were trading higher with the benchmark index Sensex rising by 2.5 per cent or 768 points in the closing session.

The US dollar also lost some ground against the euro and the pound in European trade, which strengthened the rupee.

Brent crude dropped 8 per cent to USD 17.78 per barrel while oil for Indian basket also eased by 0.68 per cent to USD 20.42 per barrel which supported the local currency.

"USD/INR spot breached fresh record high of 76.90, however, it didn't sustain and fell on dollar selling ahead of the Facebook and Reliance deal. Facebook plans to invest nearly USD 5.7 billion, the money will hit forex market in tranches either end of this month or sometime next month," Rahul Gupta, Head of Research- Currency, Emkay Global Financial Services said.

Gupta, however, noted that global market is still risk averse amid the coronavirus pandemic.

"This gloominess regarding the deep economic downturn may weigh on Indian rupee, thus, unless 76.50 and 76 doesn't break on immediate basis we expect USD/INR spot to trade towards 77 and beyond levels," Gupta said.

The number of cases around the world linked to the new coronavirus has crossed over 25.51 lakh. In India, nearly 20,000 coronavirus cases have been reported so far.

"If coronavirus cases continue to increase on the global and local front then we can expect spot to breach 77.50 and then 78 level," Gupta said.&nbsp;

The rupee on Wednesday recovered from record low levels to settle higher by 15 paise at 76.68 (provisional) against the US dollar following gains in domestic stocks and some weakness in the greenback against global currencies.

The rupee on Wednesday recovered from record low levels to settle higher by 15 paise at 76.68 (provisional) against the US dollar following gains in domestic stocks and some weakness in the greenback against global currencies. The rupee opened weak at 76.86 at the interbank forex market and then fell further to an all-time low of 76.88 during the day. Later, the domestic unit recovered the lost ground in line with surging stock markets and finally settled at 76.68, higher by 15 paise over its last close of 76.83 against the US dollar. Indian stocks were trading higher with the benchmark index Sensex rising by 2.5 per cent or 768 points in the closing session. The US dollar also lost some ground against the euro and the pound in European trade, which strengthened the rupee. Brent crude dropped 8 per cent to USD 17.78 per barrel while oil for Indian basket also eased by 0.68 per cent to USD 20.42 per barrel which supported the local currency. "USD/INR spot breached fresh record high of 76.90, however, it didn't sustain and fell on dollar selling ahead of the Facebook and Reliance deal. Facebook plans to invest nearly USD 5.7 billion, the money will hit forex market in tranches either end of this month or sometime next month," Rahul Gupta, Head of Research- Currency, Emkay Global Financial Services said. Gupta, however, noted that global market is still risk averse amid the coronavirus pandemic. "This gloominess regarding the deep economic downturn may weigh on Indian rupee, thus, unless 76.50 and 76 doesn't break on immediate basis we expect USD/INR spot to trade towards 77 and beyond levels," Gupta said. The number of cases around the world linked to the new coronavirus has crossed over 25.51 lakh. In India, nearly 20,000 coronavirus cases have been reported so far. "If coronavirus cases continue to increase on the global and local front then we can expect spot to breach 77.50 and then 78 level," Gupta said.

Rupee recovers from all-time low to settle at 76.68 against US dollar

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

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

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

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

The US dollar improved in late trading on Wednesday as the dollar index, which measures the greenback against six major peers, increased 0.58 per cent at 99.4635 in late trading.

According to Xinhua news agency, in late New York trading, the euro fell to $1.0921 from $1.0979 in the previous session, and the British pound fell to $1.2550 from $1.2627 in the previous session.

The Australian dollar decreased to $0.6329 from $0.6434.

The US dollar bought 107.45 Japanese yen, higher than 107.16 Japanese yen of the previous session. The US dollar was up to 0.9636 Swiss franc from 0.9602 Swiss franc, and it increased to 1.4083 Canadian dollars from 1.3909 Canadian dollars.

On the data front, US retail and food services sales were $483.1 billion in March, a decline of 8.7 per cent from the previous month, according to a preliminary report from the Commerce Department released on Wednesday.

The Empire State manufacturing index, a key metric to gauge business activity growth in New York State, plummeted to -78.2 in April, its lowest level on record, the Federal Reserve Bank of New York reported.

(with inputs)

The US dollar improved in late trading on Wednesday as the dollar index, which measures the greenback against six major peers, increased 0.58 per cent at 99.4635 in late trading.

The US dollar improved in late trading on Wednesday as the dollar index, which measures the greenback against six major peers, increased 0.58 per cent at 99.4635 in late trading. According to Xinhua news agency, in late New York trading, the euro fell to $1.0921 from $1.0979 in the previous session, and the British pound fell to $1.2550 from $1.2627 in the previous session. The Australian dollar decreased to $0.6329 from $0.6434. The US dollar bought 107.45 Japanese yen, higher than 107.16 Japanese yen of the previous session. The US dollar was up to 0.9636 Swiss franc from 0.9602 Swiss franc, and it increased to 1.4083 Canadian dollars from 1.3909 Canadian dollars. On the data front, US retail and food services sales were $483.1 billion in March, a decline of 8.7 per cent from the previous month, according to a preliminary report from the Commerce Department released on Wednesday. The Empire State manufacturing index, a key metric to gauge business activity growth in New York State, plummeted to -78.2 in April, its lowest level on record, the Federal Reserve Bank of New York reported. (with inputs)

US dollar appreciates in late trading

The Indian rupee tumbled by 24 paise to settle at 71.56 (provisional) against the US dollar on Tuesday as concerns over the economic fallout from coronavirus outbreak continued to roil forex market sentiment.

Besides, sustained foreign fund outflows and subdued equities also put pressure on the rupee.

Starting off the session on a weaker note, the rupee weakened further to hit the day's low of 71.56 against the American currency. The domestic unit finally settled the day at 71.56, a drop of 24 paise over its previous close.

The dollar index, which gauges the greenback's strength against a basket of six currencies, rose by 0.15 per cent to 99.15.

The 10-year government bond yield was at 6.39 per cent.

Global crude oil benchmark Brent futures dropped 1.89 per cent to trade at $56.58 per barrel.

"Rupee started the day at weak note crossing beyond 71.50, majorly on back of selling from institution in risky assets as FIIs (are) likely to be pulling out money from equities as the global market keep a check on slowdown affects on rising Coronavirus fears in China," LKP Securities Senior Research Analyst (Commodity &amp; Currency) Jateen Trivedi said.

The Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 71.4259 and for rupee/euro at 77.4162. The reference rate for rupee/British pound was fixed at 93.1737 and for rupee/100 Japanese yen at 65.02.

On the equities front, the Sensex was down 161.31 points or 0.39 per cent at 40,894.38, while the NSE barometer Nifty settled at 11,992.50, showing a fall of 53.30 points or 0.44 per cent.

Meanwhile, worries over rising death toll and the economic fallout from the novel coronavirus continued to haunt investors globally.

The coronavirus epidemic that emerged in central China has now killed nearly 1,800 people and has spread around the world.&nbsp;

The Indian rupee tumbled by 24 paise to settle at 71.56 (provisional) against the US dollar on Tuesday as concerns over the economic fallout from coronavirus outbreak continued to roil forex market sentiment.

The Indian rupee tumbled by 24 paise to settle at 71.56 (provisional) against the US dollar on Tuesday as concerns over the economic fallout from coronavirus outbreak continued to roil forex market sentiment. Besides, sustained foreign fund outflows and subdued equities also put pressure on the rupee. Starting off the session on a weaker note, the rupee weakened further to hit the day's low of 71.56 against the American currency. The domestic unit finally settled the day at 71.56, a drop of 24 paise over its previous close. The dollar index, which gauges the greenback's strength against a basket of six currencies, rose by 0.15 per cent to 99.15. The 10-year government bond yield was at 6.39 per cent. Global crude oil benchmark Brent futures dropped 1.89 per cent to trade at $56.58 per barrel. "Rupee started the day at weak note crossing beyond 71.50, majorly on back of selling from institution in risky assets as FIIs (are) likely to be pulling out money from equities as the global market keep a check on slowdown affects on rising Coronavirus fears in China," LKP Securities Senior Research Analyst (Commodity & Currency) Jateen Trivedi said. The Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 71.4259 and for rupee/euro at 77.4162. The reference rate for rupee/British pound was fixed at 93.1737 and for rupee/100 Japanese yen at 65.02. On the equities front, the Sensex was down 161.31 points or 0.39 per cent at 40,894.38, while the NSE barometer Nifty settled at 11,992.50, showing a fall of 53.30 points or 0.44 per cent. Meanwhile, worries over rising death toll and the economic fallout from the novel coronavirus continued to haunt investors globally. The coronavirus epidemic that emerged in central China has now killed nearly 1,800 people and has spread around the world.

Rupee slips 24 paise to settle at 71.56 against US dollar

The rupee lost 22 paise to close at a three-week low of 71.49 against the US dollar on Thursday tracking heavy sell-off in domestic equities amid rising concerns over the outbreak of coronavirus.

Forex traders said most Asian currencies declined after the US Federal Reserve kept its key policy rates steady.

Moreover, market participants are also assessing the economic implications of the coronavirus outbreak and awaiting cues from the Union Budget.

At the interbank foreign exchange market, the domestic currency opened weak at 71.39 a dollar. It finally settled for the day lower by 22 paise at 71.49, a level not seen since January 8. On Wednesday, the local unit had closed at 71.27 against the greenback.

Meanwhile, a positive case of novel coronavirus has been reported in Kerala, the Health Ministry said on Thursday. The patient is a student at Wuhan University.

"Rupee fell for the second successive session following rising concerns over the outbreak of coronavirus in China. On the domestic front, market participants have been a little cautious ahead of the important GDP number that will be released tomorrow and Union Budget that is scheduled this weekend," said Gaurang Somaiyaa, Forex &amp; Bullion Analyst, Motilal Oswal Financial Services.

Somaiyaa further said that "the dollar retraced from its highest level in seven weeks after the Federal Reserve, in line with expectation, held rates unchanged. In the next couple of session the USDINR (Spot) to quote in the range of 71.20 and 71.80".

Also read: <a href="https://www.wionews.com/business-economy/sensex-nifty-end-lower-on-coronavirus-fears-metals-drag-277556">Sensex, Nifty end lower on coronavirus fears; metals drag</a>

Meanwhile, the global crude benchmark Brent Futures fell 2.47 per cent to trade at $58.33 per barrel.

Crude prices have seen some moderation in the past few sessions over demand slump amid rising coronavirus cases in China and other regions.

The dollar index, which gauges the greenback's strength against a basket of six currencies, rose by 0.01 per cent to 97.99.

The 10-year Indian government bond yield was at 6.56 per cent.

On the domestic equity market front, the 30-share BSE Sensex settled 284.84 points, or 0.69 per cent, lower at 40,913.82. It hit an intra-day low of 40,829.91 and a high of 41,380.14. Likewise, the broader NSE Nifty closed 93.70 points, or 0.77 per cent, down at 12,035.80.

Foreign institutional investors sold equities worth Rs 962.28 crore on a net basis on Thursday, according to provisional exchange data.

The Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 71.1875 and for rupee/euro at 78.4221. The reference rate for rupee/British pound was fixed at 92.7174 and for rupee/100 Japanese yen at 65.24.&nbsp;

The rupee lost 22 paise to close at a three-week low of 71.49 against the US dollar on Thursday tracking heavy sell-off in domestic equities amid rising concerns over the outbreak of coronavirus.

The rupee lost 22 paise to close at a three-week low of 71.49 against the US dollar on Thursday tracking heavy sell-off in domestic equities amid rising concerns over the outbreak of coronavirus. Forex traders said most Asian currencies declined after the US Federal Reserve kept its key policy rates steady. Moreover, market participants are also assessing the economic implications of the coronavirus outbreak and awaiting cues from the Union Budget. At the interbank foreign exchange market, the domestic currency opened weak at 71.39 a dollar. It finally settled for the day lower by 22 paise at 71.49, a level not seen since January 8. On Wednesday, the local unit had closed at 71.27 against the greenback. Meanwhile, a positive case of novel coronavirus has been reported in Kerala, the Health Ministry said on Thursday. The patient is a student at Wuhan University. "Rupee fell for the second successive session following rising concerns over the outbreak of coronavirus in China. On the domestic front, market participants have been a little cautious ahead of the important GDP number that will be released tomorrow and Union Budget that is scheduled this weekend," said Gaurang Somaiyaa, Forex & Bullion Analyst, Motilal Oswal Financial Services. Somaiyaa further said that "the dollar retraced from its highest level in seven weeks after the Federal Reserve, in line with expectation, held rates unchanged. In the next couple of session the USDINR (Spot) to quote in the range of 71.20 and 71.80". Also read: Sensex, Nifty end lower on coronavirus fears; metals drag Meanwhile, the global crude benchmark Brent Futures fell 2.47 per cent to trade at $58.33 per barrel. Crude prices have seen some moderation in the past few sessions over demand slump amid rising coronavirus cases in China and other regions. The dollar index, which gauges the greenback's strength against a basket of six currencies, rose by 0.01 per cent to 97.99. The 10-year Indian government bond yield was at 6.56 per cent. On the domestic equity market front, the 30-share BSE Sensex settled 284.84 points, or 0.69 per cent, lower at 40,913.82. It hit an intra-day low of 40,829.91 and a high of 41,380.14. Likewise, the broader NSE Nifty closed 93.70 points, or 0.77 per cent, down at 12,035.80. Foreign institutional investors sold equities worth Rs 962.28 crore on a net basis on Thursday, according to provisional exchange data. The Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 71.1875 and for rupee/euro at 78.4221. The reference rate for rupee/British pound was fixed at 92.7174 and for rupee/100 Japanese yen at 65.24.

Rupee slides 22 paise to 3-week low on equity rout

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

Amid US-Iran tensions Indian rupee slips further

The dollar took US&nbsp;President Donald Trump's impeachment in stride on Thursday while its Australian counterpart rallied after a surprise fall in the country's unemployment rate. The British pound&nbsp;remained under pressure on renewed fears of a chaotic exit from the European Union. It was last at $1.3081 after sliding nearly 2 per cent&nbsp;in as many days.

<a href="https://www.wionews.com/business-economy/euro-steady-as-us-dollar-set-for-worst-week-since-october-266647">Dollar</a> traders were sanguine after a majority of lawmakers in the US&nbsp;House of Representatives voted to impeach Trump.

The dollar was a shade firmer against the safe-haven yen&nbsp;at 109.56. An index that tracks the dollar against six major currencies hovered at 97.347, not far from a six-day high of 97.475 touched on Wednesday.

"It is unlikely that the Senate will support the motion when it votes in January, as is required to remove Trump from office," ANZ economists wrote in a note.

The Aussie dollar climbed as high as $0.6883 after the robust jobs data suggested the country's labour market might have enough life in it to lessen the need for more interest rate cuts. It was last at $0.6878.

In New Zealand, better-than-expected third-quarter economic growth data sent the kiwi dollar&nbsp;bouncing off a one-week low at $0.6592.

Risk sensitive currencies such as the Aussie and the kiwi started December on a firm footing after a preliminary US-China <a href="https://www.wionews.com/opinions/us-china-trade-conflict-lack-of-trust-hobbling-the-ability-to-reach-a-deal-198533">trade deal</a> and a landslide Conservative election win in the UK removed two major uncertainties hanging over markets.

However, fears have resurfaced this week as the spectre of US-led <a href="https://www.wionews.com/business-economy/trade-war-goes-digital-countries-eye-tariffs-on-internet-economy-266783">tariff war</a> has not completely disappeared with traders awaiting more details on the "<a href="https://www.wionews.com/world/phase-one-trade-deal-reached-with-us-china-268186">phase one</a>" deal with Beijing.

US&nbsp;Trade Representative Robert Lighthizer said on Tuesday that the United States may raise tariffs on European goods as it tries to shrink its chronic trade deficit with the continent, re-igniting worries of the prospects of the export-driven euro.

The euro&nbsp;held close to Wednesday's trough of $1.1109 against the dollar, shrugging off a better-than-expected survey of German business morale. It was last at $1.1126.

"The most significant piece of news overnight has been the German December IFO survey, which... has shown evidence that the German economy may be in the process of pulling itself up by its boot straps," said Ray Attrill, Sydney-based head of forex strategy at National Australia Bank.

"Improvement in the German – and broader Eurozone – economy – is fundamental to our expectation for a softer US&nbsp;dollar and stronger Euro next year."

Markets will focus on interest rate decisions from the Bank of England, which is seen unlikely to change policy. At its previous meeting, two of the central bank's nine policymakers voted to cut interest rates.

The dollar took US President Donald Trump's impeachment in stride on Thursday while its Australian counterpart rallied after a surprise fall in the country's unemployment rate.

The dollar took US President Donald Trump's impeachment in stride on Thursday while its Australian counterpart rallied after a surprise fall in the country's unemployment rate. The British pound remained under pressure on renewed fears of a chaotic exit from the European Union. It was last at $1.3081 after sliding nearly 2 per cent in as many days. Dollar traders were sanguine after a majority of lawmakers in the US House of Representatives voted to impeach Trump. The dollar was a shade firmer against the safe-haven yen at 109.56. An index that tracks the dollar against six major currencies hovered at 97.347, not far from a six-day high of 97.475 touched on Wednesday. "It is unlikely that the Senate will support the motion when it votes in January, as is required to remove Trump from office," ANZ economists wrote in a note. The Aussie dollar climbed as high as $0.6883 after the robust jobs data suggested the country's labour market might have enough life in it to lessen the need for more interest rate cuts. It was last at $0.6878. In New Zealand, better-than-expected third-quarter economic growth data sent the kiwi dollar bouncing off a one-week low at $0.6592. Risk sensitive currencies such as the Aussie and the kiwi started December on a firm footing after a preliminary US-China trade deal and a landslide Conservative election win in the UK removed two major uncertainties hanging over markets. However, fears have resurfaced this week as the spectre of US-led tariff war has not completely disappeared with traders awaiting more details on the "phase one" deal with Beijing. US Trade Representative Robert Lighthizer said on Tuesday that the United States may raise tariffs on European goods as it tries to shrink its chronic trade deficit with the continent, re-igniting worries of the prospects of the export-driven euro. The euro held close to Wednesday's trough of $1.1109 against the dollar, shrugging off a better-than-expected survey of German business morale. It was last at $1.1126. "The most significant piece of news overnight has been the German December IFO survey, which... has shown evidence that the German economy may be in the process of pulling itself up by its boot straps," said Ray Attrill, Sydney-based head of forex strategy at National Australia Bank. "Improvement in the German – and broader Eurozone – economy – is fundamental to our expectation for a softer US dollar and stronger Euro next year." Markets will focus on interest rate decisions from the Bank of England, which is seen unlikely to change policy. At its previous meeting, two of the central bank's nine policymakers voted to cut interest rates.

Dollar barely flinches after Trump impeachment, Aussie jumps on solid jobs data

The <a href="https://www.wionews.com/world/italy-readies-web-tax-in-its-2020-budget-sources-255911">euro </a>was steady against the dollar on Friday, though the greenback was headed for its worst week since mid-October, dragged down by nervousness around US-China trade relations and hints of weakness in the US&nbsp;economy.

The resurgent kiwi enjoyed a hefty recovery thanks to some renewed risk appetite, as well as due to positive domestic factors.

Against a basket of six currencies, the greenback fell to a one-month low of 97.355. The euro was last flat at $ 1.1106.

Sterling was 0.2 per cent&nbsp;weaker at $1.3132 and 84.58 pence against the euro&nbsp;but parked close to a 2-1/2-year high as traders grow more confident the uncertainty over Brexit could soon be over.

Opinion polls suggest the Conservative Party of Prime Minister <a href="https://www.wionews.com/world/uk-pm-boris-johnson-rejects-calls-for-no-deal-brexit-in-election-pitch-259559">Boris Johnson</a> is on course for a majority on December 12 to push through the Brexit deal he struck with the EU after the bloc granted a third delay to a divorce that was originally supposed to have taken place at the end of March.

US&nbsp;President <a href="https://www.wionews.com/business-economy/global-stocks-rattled-after-donald-trump-says-no-deadline-on-us-china-trade-deal-266025">Donald Trump</a> remained upbeat overnight on trade and said talks are "moving right along" and that "we'll have to see" about the increase in tariffs that are scheduled to take place on December&nbsp;15.

But markets were unconvinced, with worries stemming from a lack of similar enthusiasm from China, keeping the dollar subdued.

Chinese officials reiterated their stance that some US&nbsp;tariffs must be rolled back for a deal to end the 17-month trade war between the two powers, something Washington has given no sign of doing.&nbsp;

Still, risk sentiment recovered somewhat, pushing the New Zealand dollar to a four-month high of 0.6568 against the US&nbsp;dollar.

"My guess and it’s just a guess is that the rally in NZD may have started with a recovery in risk sentiment" driven by Trump's comments, said Marshall Gittler, strategist at ACLS Global, noting the kiwi tracked the safe-haven Japanese yen's performance on Thursday.

The currency also got a boost from Reserve Bank of New Zealand Deputy Governor Geoff Bascand saying in a Bloomberg interview that the latest economic&nbsp;developments are "supportive of the story that we’re near or around that turning point" in the economic cycle, Gittler said.

US&nbsp;non-farm payrolls data due at 1330 GMT comes after dismal numbers showed weak private payrolls, soft services activity, and a shrinking manufacturing sector.

A Reuters poll shows a forecast of 180,000 jobs being added in November, and a miss might leave the Fed reconsidering its wait-and-see mode when the committee meets on Tuesday and Wednesday.

"Markets are in a highly fragile condition at the moment," said Michael McCarthy, chief market strategist at CMC Markets in Sydney.

"So there is a greater potential for an exaggerated move if we see a big divergence from expectations," he said. "The risk is in both directions&nbsp;below 150,000 or above 210,000 we could see a significant market reaction."

The euro was steady against the dollar on Friday, though the greenback was headed for its worst week since mid-October, dragged down by nervousness around US-China trade relations and hints of weakness in the US economy.

The euro was steady against the dollar on Friday, though the greenback was headed for its worst week since mid-October, dragged down by nervousness around US-China trade relations and hints of weakness in the US economy. The resurgent kiwi enjoyed a hefty recovery thanks to some renewed risk appetite, as well as due to positive domestic factors. Against a basket of six currencies, the greenback fell to a one-month low of 97.355. The euro was last flat at $ 1.1106. Sterling was 0.2 per cent weaker at $1.3132 and 84.58 pence against the euro but parked close to a 2-1/2-year high as traders grow more confident the uncertainty over Brexit could soon be over. Opinion polls suggest the Conservative Party of Prime Minister Boris Johnson is on course for a majority on December 12 to push through the Brexit deal he struck with the EU after the bloc granted a third delay to a divorce that was originally supposed to have taken place at the end of March. US President Donald Trump remained upbeat overnight on trade and said talks are "moving right along" and that "we'll have to see" about the increase in tariffs that are scheduled to take place on December 15. But markets were unconvinced, with worries stemming from a lack of similar enthusiasm from China, keeping the dollar subdued. Chinese officials reiterated their stance that some US tariffs must be rolled back for a deal to end the 17-month trade war between the two powers, something Washington has given no sign of doing. Still, risk sentiment recovered somewhat, pushing the New Zealand dollar to a four-month high of 0.6568 against the US dollar. "My guess and it’s just a guess is that the rally in NZD may have started with a recovery in risk sentiment" driven by Trump's comments, said Marshall Gittler, strategist at ACLS Global, noting the kiwi tracked the safe-haven Japanese yen's performance on Thursday. The currency also got a boost from Reserve Bank of New Zealand Deputy Governor Geoff Bascand saying in a Bloomberg interview that the latest economic developments are "supportive of the story that we’re near or around that turning point" in the economic cycle, Gittler said. US non-farm payrolls data due at 1330 GMT comes after dismal numbers showed weak private payrolls, soft services activity, and a shrinking manufacturing sector. A Reuters poll shows a forecast of 180,000 jobs being added in November, and a miss might leave the Fed reconsidering its wait-and-see mode when the committee meets on Tuesday and Wednesday. "Markets are in a highly fragile condition at the moment," said Michael McCarthy, chief market strategist at CMC Markets in Sydney. "So there is a greater potential for an exaggerated move if we see a big divergence from expectations," he said. "The risk is in both directions below 150,000 or above 210,000 we could see a significant market reaction."

Euro steady as US dollar set for worst week since October

The <a href="https://www.wionews.com/business-%26-economy/indian-rupee-since-independence-a-brief-history-159436">Indian&nbsp;rupee</a>&nbsp;will not recover lost ground in the coming&nbsp;year, according to a&nbsp;Reuters&nbsp;poll&nbsp;of currency strategists who are more pessimistic than last month amid doubts over any kind of trade truce between the United States and China.

Most emerging markets currencies have depreciated against the <a href="https://www.wionews.com/business-economy/rupee-slips-17-paise-to-6932-vs-us-dollar-in-early-trade-230729">US&nbsp;dollar</a>, hurt by the tit-for-tat trade war between the world's two largest economies, and there are scant signs of a resolution anytime soon.

Also weighing on the currency's outlook, the <a href="https://www.wionews.com/business-economy/india-seen-making-sixth-interest-rate-cut-but-no-cure-for-economys-ills-265905">Reserve Bank of India </a>has cut its key interest rate by 135 basis points&nbsp;so far this&nbsp;year&nbsp;to support a slowing economy. It is expected to cut the repo rate by another 25 basis points to 4.90 per cent&nbsp;on Thursday.

"Global trade talks are turning topsy-turvy, a lot will depend on how that plays out. Domestically, the tide has turned rough for the <a href="https://www.wionews.com/videos/reserve-bank-of-india-scales-down-printing-of-inr-2000-notes-188206">INR</a>, led by tapering of domestic growth optimism and fiscal worries - all weighing on the&nbsp;rupee's way forward," Madhavi Arora, lead economist, FX and rates at Edelweiss Securities said.

"After December's rate cut&nbsp;reforms in the banking sector and strong infrastructure investments are needed in addition to a monetary stimulus to help growth and the&nbsp;rupee."

The December 2-4&nbsp;poll, taken before the monetary policy committee's announcement due later on Thursday, showed the currency would weaken 0.6 per cent&nbsp;to 72.00 per dollar in a&nbsp;year&nbsp;from 71.57 where it was trading around on Wednesday.

The&nbsp;year&nbsp;ahead outlook was the most pessimistic for the&nbsp;rupee&nbsp;since October.

Over the coming&nbsp;year, 23 of 51 strategists expected the&nbsp;rupee&nbsp;to breach 72.40 against the dollar&nbsp;its weakest trade this&nbsp;year. Six of those expected it to weaken beyond its lifetime low of 74.48 per dollar.

But a few analysts argued the&nbsp;rupee's weakness was a deliberate attempt by the RBI to boost exports that have been on a downward trend.

"There is a conscious effort by the RBI to provide a depreciation bias to the&nbsp;rupee. That could probably become a new norm for at&nbsp;least&nbsp;sometimes, so the export sector slightly benefits," said Upasna Bhardwaj, senior economist at Kotak Mahindra Bank.

"The pace at which the RBI has been buying dollars clearly signals a new policy the RBI is adopting. Its bias for a relatively weaker currency will determine its direction. This is an unsaid policy obviously, but through actions like dollar purchases it is suggestive of that."

The Indian rupee will not recover lost ground in the coming year, according to a Reuters poll of currency strategists who are more pessimistic than last month amid doubts over any kind of trade truce between the United States and China.

The Indian rupee will not recover lost ground in the coming year, according to a Reuters poll of currency strategists who are more pessimistic than last month amid doubts over any kind of trade truce between the United States and China. Most emerging markets currencies have depreciated against the US dollar, hurt by the tit-for-tat trade war between the world's two largest economies, and there are scant signs of a resolution anytime soon. Also weighing on the currency's outlook, the Reserve Bank of India has cut its key interest rate by 135 basis points so far this year to support a slowing economy. It is expected to cut the repo rate by another 25 basis points to 4.90 per cent on Thursday. "Global trade talks are turning topsy-turvy, a lot will depend on how that plays out. Domestically, the tide has turned rough for the INR, led by tapering of domestic growth optimism and fiscal worries - all weighing on the rupee's way forward," Madhavi Arora, lead economist, FX and rates at Edelweiss Securities said. "After December's rate cut reforms in the banking sector and strong infrastructure investments are needed in addition to a monetary stimulus to help growth and the rupee." The December 2-4 poll, taken before the monetary policy committee's announcement due later on Thursday, showed the currency would weaken 0.6 per cent to 72.00 per dollar in a year from 71.57 where it was trading around on Wednesday. The year ahead outlook was the most pessimistic for the rupee since October. Over the coming year, 23 of 51 strategists expected the rupee to breach 72.40 against the dollar its weakest trade this year. Six of those expected it to weaken beyond its lifetime low of 74.48 per dollar. But a few analysts argued the rupee's weakness was a deliberate attempt by the RBI to boost exports that have been on a downward trend. "There is a conscious effort by the RBI to provide a depreciation bias to the rupee. That could probably become a new norm for at least sometimes, so the export sector slightly benefits," said Upasna Bhardwaj, senior economist at Kotak Mahindra Bank. "The pace at which the RBI has been buying dollars clearly signals a new policy the RBI is adopting. Its bias for a relatively weaker currency will determine its direction. This is an unsaid policy obviously, but through actions like dollar purchases it is suggestive of that."

Indian Rupee on slippery slope for at least a year: Sources

China's offshore yuan surged past 7 per dollar to four-month highs on Tuesday, benefiting from signs Beijing and Washington are approaching a trade deal and also from the Chinese central bank's decision to trim lending rates by only 5 basis points.

Optimism over trade also boosted other trade-reliant currencies, such as the Australian and New Zealand dollars, which rose as much as half a per cent.

China is pushing US&nbsp;President Donald Trump to remove more tariffs imposed in September as part of a "<a href="https://www.wionews.com/world/united-states-china-close-to-finalising-part-of-a-phase-one-trade-deal-report-258209">phase one</a>" US-China trade deal, which is expected to be signed later this month, people familiar with the negotiations said.

The yuan jumped 0.6 per cent to the highest since August&nbsp;5 at 6.9930. The onshore yuan also posted its strongest close since August&nbsp;2.&nbsp;

The currency held its gains even after China's central bank cut its one-year medium-term lending facility (MLF) rate for the first time since early 2016, though it opted for a 5 bps cut that Commerzbank called "tiny".

"It might be fair to say the PBoC only fine-tuned its monetary policy stance ... Typically, a rate cut will bring depreciation pressure to the currency," Commerzbank told clients, adding the trade optimism was the main factor driving the yuan above the 7 mark.

China and the US&nbsp;have imposed tariffs on each other's goods in a trade war that has dragged on for 16 months and raised the spectre of a global recession. Resolving the row would boost riskier assets, ease concern about the economic outlook and reduce the need for aggressive monetary easing.

The US&nbsp;dollar was flat against a basket of currencies&nbsp;in early London trading but advanced around a quarter per cent against the safe-haven yen and Swiss franc.

Kit Juckes, head of FX strategy at Société Générale, said the agreement would probably mark a truce rather than peace but added that "the chance of getting a first-stage deal seems to be quite good."

The optimism spilt over into other currencies, with the Australian dollar not far off three-month highs. It wasn't much moved after the central bank left monetary policy unchanged, as expected. The kiwi dollar rose 0.3 per cent.

The Norwegian and Swedish crowns also rose versus both the dollar and euro.

The euro was flat against the dollar. It rose 0.26 percent&nbsp;versus the yen.

Jukes said the euro would be one of the last currencies to benefit from improved risk sentiment, noting that Monday's data showing Polish manufacturing activity in its sharpest downturn in 10 years had taken the wind out of the euro's sails.

Central European states such as Poland are a key market and investment destination for eurozone companies.

China's offshore yuan surged past 7 per dollar to four-month highs on Tuesday, benefiting from signs Beijing and Washington are approaching a trade deal and also from the Chinese central bank's decision to trim lending rates by only 5 basis points.

China's offshore yuan surged past 7 per dollar to four-month highs on Tuesday, benefiting from signs Beijing and Washington are approaching a trade deal and also from the Chinese central bank's decision to trim lending rates by only 5 basis points. Optimism over trade also boosted other trade-reliant currencies, such as the Australian and New Zealand dollars, which rose as much as half a per cent. China is pushing US President Donald Trump to remove more tariffs imposed in September as part of a "phase one" US-China trade deal, which is expected to be signed later this month, people familiar with the negotiations said. The yuan jumped 0.6 per cent to the highest since August 5 at 6.9930. The onshore yuan also posted its strongest close since August 2. The currency held its gains even after China's central bank cut its one-year medium-term lending facility (MLF) rate for the first time since early 2016, though it opted for a 5 bps cut that Commerzbank called "tiny". "It might be fair to say the PBoC only fine-tuned its monetary policy stance ... Typically, a rate cut will bring depreciation pressure to the currency," Commerzbank told clients, adding the trade optimism was the main factor driving the yuan above the 7 mark. China and the US have imposed tariffs on each other's goods in a trade war that has dragged on for 16 months and raised the spectre of a global recession. Resolving the row would boost riskier assets, ease concern about the economic outlook and reduce the need for aggressive monetary easing. The US dollar was flat against a basket of currencies in early London trading but advanced around a quarter per cent against the safe-haven yen and Swiss franc. Kit Juckes, head of FX strategy at Société Générale, said the agreement would probably mark a truce rather than peace but added that "the chance of getting a first-stage deal seems to be quite good." The optimism spilt over into other currencies, with the Australian dollar not far off three-month highs. It wasn't much moved after the central bank left monetary policy unchanged, as expected. The kiwi dollar rose 0.3 per cent. The Norwegian and Swedish crowns also rose versus both the dollar and euro. The euro was flat against the dollar. It rose 0.26 percent versus the yen. Jukes said the euro would be one of the last currencies to benefit from improved risk sentiment, noting that Monday's data showing Polish manufacturing activity in its sharpest downturn in 10 years had taken the wind out of the euro's sails. Central European states such as Poland are a key market and investment destination for eurozone companies.

Chinese yuan surges to three-month high on trade optimism, 'tiny' rate cut

Oil&nbsp;prices lost about&nbsp;2 per cent&nbsp;on Monday on worries that global crude demand could stay under pressure as few details about the <a href="https://www.wionews.com/world/us-president-donald-trump-announces-partial-trade-deal-with-china-255358">first phase of a&nbsp;U.S.-China&nbsp;trade&nbsp;deal</a>&nbsp;did little to assure a quick resolution to the tariff fight.

Oil&nbsp;prices also felt pressure as the&nbsp;US&nbsp;dollar, which has an inverse relationship with crude prices, gained as waning&nbsp;trade&nbsp;deal&nbsp;hopes and ongoing concerns over <a href="https://www.wionews.com/world/brexit-on-october-31-a-priority-for-british-government-queen-255851">Britain's exit </a>from the European Union attracted safe-haven investments.

Brent crude&nbsp;settled at $59.35 a barrel, shedding $1.16, or 1.92 per cent, while&nbsp;US&nbsp;West Texas Intermediate (WTI) crude&nbsp;settled at $53.59 a barrel, losing $1.11, or 2.03 per cent.

"The complex is in (the) process of relinquishing a major portion of the late week&nbsp;trade&nbsp;inspired gains as conflicting indications out of the&nbsp;U.S. and&nbsp;China&nbsp;regarding&nbsp;trade&nbsp;progress is reducing risk appetite," said Jim Ritterbusch of Ritterbusch and Associates.

Late on Friday, Washington and Beijing outlined the first stage of a&nbsp;trade&nbsp;deal&nbsp;and suspended this week's scheduled&nbsp;US&nbsp;tariff hikes. Brent and WTI rose&nbsp;more&nbsp;than&nbsp;3 per cent&nbsp;last week, their first weekly increase since the week starting September&nbsp;20, on signs of progress toward a&nbsp;trade&nbsp;deal&nbsp;that would boost crude demand.

But optimism that the&nbsp;trade&nbsp;negotiations would prove successful faded, as&nbsp;China&nbsp;indicated further discussions were needed and&nbsp;US&nbsp;Treasury Secretary Steven Mnuchin said the next round of tariffs on Chinese imports are still set to take effect on December&nbsp;15 if a&nbsp;deal&nbsp;has not been reached by then.

But existing tariffs remain in place and officials on both sides said much&nbsp;more&nbsp;work was needed before an accord could be agreed.

A good portion of the gains last week came after the United States announced on Friday it was deploying&nbsp;<a href="https://www.wionews.com/world/us-says-deploying-more-forces-to-saudi-arabia-to-counter-iran-threat-255380">more&nbsp;troops to Saudi Arabia</a>, and after an Iranian&nbsp;oil&nbsp;tanker was attacked in the Red Sea.

Oil&nbsp;prices had drawn some support from worries that further escalation along the <a href="https://www.wionews.com/photos/explainer-turkey-set-to-redraw-map-of-syrian-war-once-more-254794">Syrian and Turkish border</a> could affect output or exports from Iraq. Syrian troops entered a northeastern town on Monday.

The Saudi energy minister, Prince Abdulaziz bin Salman, said&nbsp;oil&nbsp;exporters were showing serious commitment to global output cuts&nbsp;in a&nbsp;deal&nbsp;between OPEC and its allies, a grouping known as OPEC+.

Russian Energy Minister Alexander Novak said there were no talks underway to change the OPEC+&nbsp;deal.

Kuwait's&nbsp;oil&nbsp;minister said it was too early to discuss&nbsp;a possible buildup in&nbsp;oil&nbsp;inventories in 2020. Khaled al-Fadhel said a price range of $50 to $70 per barrel would be acceptable.

The compliance of OPEC+ producers with the supply-reduction agreement was seen at above 200 per cent&nbsp;in September, sources familiar with the matter said.

Bin Salman also said on Monday that Saudi Arabia's&nbsp;oil&nbsp;production will recover in October and November to levels above those seen before attacks on its energy installations in September, which weighed on&nbsp;oil&nbsp;prices.

Oil prices lost about 2 per cent on Monday on worries that global crude demand could stay under pressure as few details about the first phase of a U.S.-China trade deal did little to assure a quick resolution to the tariff fight.

Oil prices lost about 2 per cent on Monday on worries that global crude demand could stay under pressure as few details about the first phase of a U.S.-China trade deal did little to assure a quick resolution to the tariff fight. Oil prices also felt pressure as the US dollar, which has an inverse relationship with crude prices, gained as waning trade deal hopes and ongoing concerns over Britain's exit from the European Union attracted safe-haven investments. Brent crude settled at $59.35 a barrel, shedding $1.16, or 1.92 per cent, while US West Texas Intermediate (WTI) crude settled at $53.59 a barrel, losing $1.11, or 2.03 per cent. "The complex is in (the) process of relinquishing a major portion of the late week trade inspired gains as conflicting indications out of the U.S. and China regarding trade progress is reducing risk appetite," said Jim Ritterbusch of Ritterbusch and Associates. Late on Friday, Washington and Beijing outlined the first stage of a trade deal and suspended this week's scheduled US tariff hikes. Brent and WTI rose more than 3 per cent last week, their first weekly increase since the week starting September 20, on signs of progress toward a trade deal that would boost crude demand. But optimism that the trade negotiations would prove successful faded, as China indicated further discussions were needed and US Treasury Secretary Steven Mnuchin said the next round of tariffs on Chinese imports are still set to take effect on December 15 if a deal has not been reached by then. But existing tariffs remain in place and officials on both sides said much more work was needed before an accord could be agreed. A good portion of the gains last week came after the United States announced on Friday it was deploying more troops to Saudi Arabia, and after an Iranian oil tanker was attacked in the Red Sea. Oil prices had drawn some support from worries that further escalation along the Syrian and Turkish border could affect output or exports from Iraq. Syrian troops entered a northeastern town on Monday. The Saudi energy minister, Prince Abdulaziz bin Salman, said oil exporters were showing serious commitment to global output cuts in a deal between OPEC and its allies, a grouping known as OPEC+. Russian Energy Minister Alexander Novak said there were no talks underway to change the OPEC+ deal. Kuwait's oil minister said it was too early to discuss a possible buildup in oil inventories in 2020. Khaled al-Fadhel said a price range of $50 to $70 per barrel would be acceptable. The compliance of OPEC+ producers with the supply-reduction agreement was seen at above 200 per cent in September, sources familiar with the matter said. Bin Salman also said on Monday that Saudi Arabia's oil production will recover in October and November to levels above those seen before attacks on its energy installations in September, which weighed on oil prices.

Oil falls more than 2% on US-China trade deal doubts, stronger dollar

The dollar fell while safe havens and currencies of oil-producing countries rallied on Monday, following an attack on Saudi Arabian refining facilities that disrupted global oil supply and heightened Middle East tensions.

The dollar fell while safe havens and currencies of oil-producing countries rallied on Monday, following an attack on Saudi Arabian refining facilities that disrupted global oil supply and heightened Middle East tensions. Oil prices surged nearly a fifth at one point following the strikes on two plants, including the world's biggest petroleum processing facility in Abqaiq, which knocked out more than 5% of global oil supply. Yemen's Iran-aligned Houthi group claimed responsibility for the damage, but the US has pointed the finger directly at Iran. The Canadian dollar rose 0.4% to 1.3233 per dollar. The Norwegian krone rose 0.5% to 8.9363 per dollar. Both currencies often move together with the oil price because the countries are major oil exporters. In India, a major importer of crude, the rupee fell almost 0.7%. "The natural flow through of higher (oil) prices has seen the NOK and the CAD outperform, and we'll probable see a better feel towards the (Russian) rouble later on," said Chris Weston, head of research at brokerage Pepperstone Group in Melbourne. The attacks reversed last week's ebullient risk appetite and prompted US President Donald Trump to tweet that the United States was "locked and loaded" for a response. "We've got a beady eye on this and we're prepared to pile back in to the Japanese yen after last week's repositioning," Weston said, adding that while trade was calm, the strikes presented another geopolitical "what if" to vex markets. The safe-haven Japanese yen and Swiss franc both firmed. The yen rose 0.3% to 107.79 per dollar and the franc rose 0.4% to $0.9883. Gold jumped by 1%. Against a basket of currencies the dollar edged lower to 98.162. Beyond oil, currency markets are awaiting the outcome of central bank meetings in the U.S. and Japan this week and economic data in Australia and New Zealand that could determine the rates outlook in the Antipodes. "Geopolitical risks and central bank rhetoric remain key drivers of risk this week," Australia and New Zealand Banking Group analysts said in a note. On the Brexit front, British Prime Minister Boris Johnson's confidence of sealing a deal to leave the European Union by October 31 applied renewed pressure to the pound. Sterling fell 0.3 from a seven-week high to hit $1.2486. While much of the risk appetite on display last week was driven by signs of a thaw in US-China trade tensions, few fresh indications of progress left sentiment fragile. Data released on Monday showed the slowdown in China's economy deepened in August, with industrial production growing at its weakest pace in 17-1/2 years and retail sales weaker than anticipated. That added to pressure for stimulus and in offshore trade the Chinese yuan weakened 0.25% to 7.0631 per dollar. In the United States, investors who had begun trimming expectations for a U.S. Federal Reserve rate cut on Wednesday are now certain rates will fall and divided only over how much. As for the Bank of Japan's policy decision on Thursday, a third of economists polled by Reuters expect stimulus to be ramped up. But sources say it may be a close call as policymakers wait till the last minute to assess market reaction to the Fed's decision hours earlier. Japanese markets are closed on Monday for a public holiday. The euro was steady at $1.1073.

Dollar falls, oil-exporter currencies rise after Saudi attacks; yen firms

The Indian rupee opened the week lower and slipped by 32 paise at 71.98 per dollar in early trade on Monday against its previous close 71.66.

The Indian currency rose on Friday on hopes of revival measures from Finance Minister Nirmala Sitharaman who announced the first stimulus package for India Inc amid the domestic and global economic slowdown.

Market experts said the rupee's lower opening was largely due to weak global cues.&nbsp;

Both Asian and US markets crashed after the US-China trade war intensified.

Meanwhile, China`s yuan slumped to a fresh 11-year low against the dollar.&nbsp;

The offshore yuan fell to a record low of 7.1850, before regaining some ground to around 7.1595.

On Friday, US President Donald Trump announced an additional duty on 550 billion dollars of targeted Chinese goods after China unveiled retaliatory tariffs on 75 billion dollars worth of American goods.

The Indian rupee opened the week lower and slipped by 32 paise at 71.98 per dollar in early trade on Monday against its previous close 71.66. The Indian currency rose on Friday on hopes of revival measures from Finance Minister Nirmala Sitharaman who announced the first stimulus package for India Inc amid the domestic and global economic slowdown.

The Indian rupee opened the week lower and slipped by 32 paise at 71.98 per dollar in early trade on Monday against its previous close 71.66. The Indian currency rose on Friday on hopes of revival measures from Finance Minister Nirmala Sitharaman who announced the first stimulus package for India Inc amid the domestic and global economic slowdown. Market experts said the rupee's lower opening was largely due to weak global cues. Both Asian and US markets crashed after the US-China trade war intensified. Meanwhile, China`s yuan slumped to a fresh 11-year low against the dollar. The offshore yuan fell to a record low of 7.1850, before regaining some ground to around 7.1595. On Friday, US President Donald Trump announced an additional duty on 550 billion dollars of targeted Chinese goods after China unveiled retaliatory tariffs on 75 billion dollars worth of American goods.

Rupee starts the week lower at 71.98 for a US dollar

US electric vehicle maker <a href="https://www.wionews.com/world/tesla-drops-cheapest-model-x-s-variants-cuts-prices-to-simplify-lineup-236346">Tesla Inc</a> will raise prices in China on Friday, earlier than planned, and is considering increasing prices again in December should Chinese tariffs on US-made cars take effect, people familiar with the matter said.

The people declined to be identified as the plan has not been made public.

A Tesla representative did not immediately respond to Reuters' request for comment on Monday.

The company is among many impacted by Sino-US trade friction.

It currently imports all the cars it sells in China and has had to adjust prices multiple times over the past year due to tariff changes.

Reuters reported this month that Tesla was considering to lift prices in China from September after the yuan weakened significantly against the US dollar.

One person told Reuters on Monday that the automaker was bringing forward these plans to August 30.

Both people said the automaker is now also mulling another price hike in December after China's commerce ministry last week announced it would reinstitute tariffs of 25 per cent on vehicles and 5 per cent on auto parts which it suspended in December, in the latest tit-for-tat escalation of the trade war.

"Tesla will also try to ship more cars to China before December, before the tariff hikes," said one of the people.

US electric vehicle maker Tesla Inc will raise prices in China on Friday, earlier than planned, and is considering increasing prices again in December should Chinese tariffs on US-made cars take effect, people familiar with the matter said.

US electric vehicle maker Tesla Inc will raise prices in China on Friday, earlier than planned, and is considering increasing prices again in December should Chinese tariffs on US-made cars take effect, people familiar with the matter said. The people declined to be identified as the plan has not been made public. A Tesla representative did not immediately respond to Reuters' request for comment on Monday. The company is among many impacted by Sino-US trade friction. It currently imports all the cars it sells in China and has had to adjust prices multiple times over the past year due to tariff changes. Reuters reported this month that Tesla was considering to lift prices in China from September after the yuan weakened significantly against the US dollar. One person told Reuters on Monday that the automaker was bringing forward these plans to August 30. Both people said the automaker is now also mulling another price hike in December after China's commerce ministry last week announced it would reinstitute tariffs of 25 per cent on vehicles and 5 per cent on auto parts which it suspended in December, in the latest tit-for-tat escalation of the trade war. "Tesla will also try to ship more cars to China before December, before the tariff hikes," said one of the people.

Tesla to raise prices in China on August 30, may increase again in December: Report

Weaponising Yuan: Beijing's double-edged sword

The United States on Monday formally accused <a href="https://www.wionews.com/world/trump-defends-stance-on-china-trade-after-new-tariffs-says-things-are-going-well-240486">China of manipulating </a>its currency, marking the second major escalation in the two countries' spiralling trade war in just 24 hours.

Washington's sudden move came the day China allowed the yuan to fall below 7 to the dollar for the first time in about a decade -&nbsp;provoking US President Donald Trump's ire and <a href="https://www.wionews.com/south-asia/pakistan-looses-3-key-positions-in-world-trade-organisation-240613">sending global equities</a> markets diving into the red.

Wall Street on Monday posted its worst one-day losses of 2019 as hope of any near-term resolution to the year-long trade war between the world's top two economies appeared to slide out of view.

In a Twitter outburst earlier in the day, Trump had angrily accused Beijing of weakening the yuan "to steal our businesses and factories."

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China is intent on continuing to receive the hundreds of Billions of Dollars they have been taking from the U.S. with unfair trade practices and currency manipulation. So one-sided, it should have been stopped many years ago!
— Donald J. Trump (@realDonaldTrump) <a href="https://twitter.com/realDonaldTrump/status/1158407373666566145?ref_src=twsrc%5Etfw">August 5, 2019</a></blockquote>
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US Treasury Secretary Steven Mnuchin, "under the auspices of President Trump, has today determined that China is a<a href="https://www.wionews.com/business-economy/chinese-yuan-falls-to-weakest-level-against-the-dollar-since-2010-240743"> currency manipulator</a>," the Treasury Department said in a statement late Monday.

As a result, Mnuchin will engage the International Monetary Fund "to eliminate the unfair competitive advantage created by China's latest actions," the statement said.

The new designation is largely symbolic, since it calls for consultations with countries found to be manipulating their currencies.

But it could gain teeth if the Commerce Department begins imposing tariffs on countries found to be undervaluing their currencies, as that department said earlier this year it plans to do.

The volley lobbed across the Pacific on Monday was sure to shake the global economy even further, with markets doubtful that either side is willing or able to prevent hostilities from spinning out of control.

Chinese state media also announced Monday that Beijing had suspended purchases of American farm exports, piling pain on US agricultural states already battered by Beijing's retaliation in the trade war.

The yuan's weakening came just days after Trump announced plans to raise tariffs on another $300 billion in Chinese imports starting September 1, accusing Beijing of failing to live up to commitments in trade negotiations.

That would mean virtually all of the roughly $660 billion in goods exchanged annually between China and the United States are subject to trade barriers.

The battle has sapped business confidence and undermined both countries' manufacturing sectors just as the world economy's slowdown worsens.

Activity in the US service sector hit a three-year low last month, survey data showed Monday, confirming a step-down in US economic growth.

Trump's move was also sudden: On the campaign trail, he had loudly pledged to designate China a currency manipulator but his administration had until Monday refrained from doing so.

The Treasury Department had instead kept China on a "monitoring list" of countries subject to close scrutiny due to their currency practices, including in its most recent report released in May.&nbsp;

The yuan is not freely convertible and the government limits its movement against the US dollar to a two per cent range on either side of a central parity rate which the People's Bank of China (PBOC) sets each day to reflect market trends and control volatility.

"It appears that the tariffs hike suggests the return of tit-for-tat moves and a suspension of trade talks, and the PBOC sees no need to keep the yuan stable in the near term," Ken Cheung, a senior currency strategist at Mizuho Bank, told Bloomberg News.

In a statement on Monday morning, the PBOC said the exchange rate against the US dollar had been "affected by unilateralism and trade protectionism measures and the imposition of tariff increases on China."

The central bank said the yuan remained "stable and strong against the basket of currencies" and said it would "resolutely crack down on short-term speculation and maintain stable operation of the foreign exchange market and stabilize market expectations."

It went on to say that it had the "experience, confidence and ability to keep the RMB exchange rate basically stable at a reasonable and balanced level."

Julian Evans-Pritchard, senior China economist with Capital Economics, said the PBOC has "effectively weaponized the exchange rate" by linking the currency with the US trade war.

"Given that their goal is presumably to offset some of the impact from additional US tariffs, they are likely to allow the currency to weaken further, probably by 5-10 per cent over the coming quarters," said Evans-Pritchard.

The United States on Monday formally accused China of manipulating its currency, marking the second major escalation in the two countries' spiralling trade war in just 24 hours.

The United States on Monday formally accused China of manipulating its currency, marking the second major escalation in the two countries' spiralling trade war in just 24 hours. Washington's sudden move came the day China allowed the yuan to fall below 7 to the dollar for the first time in about a decade - provoking US President Donald Trump's ire and sending global equities markets diving into the red. Wall Street on Monday posted its worst one-day losses of 2019 as hope of any near-term resolution to the year-long trade war between the world's top two economies appeared to slide out of view. In a Twitter outburst earlier in the day, Trump had angrily accused Beijing of weakening the yuan "to steal our businesses and factories." China is intent on continuing to receive the hundreds of Billions of Dollars they have been taking from the U.S. with unfair trade practices and currency manipulation. So one-sided, it should have been stopped many years ago! — Donald J. Trump (@realDonaldTrump) August 5, 2019 × US Treasury Secretary Steven Mnuchin, "under the auspices of President Trump, has today determined that China is a currency manipulator," the Treasury Department said in a statement late Monday. As a result, Mnuchin will engage the International Monetary Fund "to eliminate the unfair competitive advantage created by China's latest actions," the statement said. The new designation is largely symbolic, since it calls for consultations with countries found to be manipulating their currencies. But it could gain teeth if the Commerce Department begins imposing tariffs on countries found to be undervaluing their currencies, as that department said earlier this year it plans to do. The volley lobbed across the Pacific on Monday was sure to shake the global economy even further, with markets doubtful that either side is willing or able to prevent hostilities from spinning out of control. Chinese state media also announced Monday that Beijing had suspended purchases of American farm exports, piling pain on US agricultural states already battered by Beijing's retaliation in the trade war. The yuan's weakening came just days after Trump announced plans to raise tariffs on another $300 billion in Chinese imports starting September 1, accusing Beijing of failing to live up to commitments in trade negotiations. That would mean virtually all of the roughly $660 billion in goods exchanged annually between China and the United States are subject to trade barriers. The battle has sapped business confidence and undermined both countries' manufacturing sectors just as the world economy's slowdown worsens. Activity in the US service sector hit a three-year low last month, survey data showed Monday, confirming a step-down in US economic growth. Trump's move was also sudden: On the campaign trail, he had loudly pledged to designate China a currency manipulator but his administration had until Monday refrained from doing so. The Treasury Department had instead kept China on a "monitoring list" of countries subject to close scrutiny due to their currency practices, including in its most recent report released in May. The yuan is not freely convertible and the government limits its movement against the US dollar to a two per cent range on either side of a central parity rate which the People's Bank of China (PBOC) sets each day to reflect market trends and control volatility. "It appears that the tariffs hike suggests the return of tit-for-tat moves and a suspension of trade talks, and the PBOC sees no need to keep the yuan stable in the near term," Ken Cheung, a senior currency strategist at Mizuho Bank, told Bloomberg News. In a statement on Monday morning, the PBOC said the exchange rate against the US dollar had been "affected by unilateralism and trade protectionism measures and the imposition of tariff increases on China." The central bank said the yuan remained "stable and strong against the basket of currencies" and said it would "resolutely crack down on short-term speculation and maintain stable operation of the foreign exchange market and stabilize market expectations." It went on to say that it had the "experience, confidence and ability to keep the RMB exchange rate basically stable at a reasonable and balanced level." Julian Evans-Pritchard, senior China economist with Capital Economics, said the PBOC has "effectively weaponized the exchange rate" by linking the currency with the US trade war. "Given that their goal is presumably to offset some of the impact from additional US tariffs, they are likely to allow the currency to weaken further, probably by 5-10 per cent over the coming quarters," said Evans-Pritchard.

US designates China a currency manipulator as yuan hits record low

The dollar charged to its highest in more than two years on Thursday after the <a href="https://www.google.com/url?client=internal-uds-cse&amp;cx=006054055338965708568:09spwrlibei&amp;q=https://www.wionews.com/business-economy/stormy-sterling-sinks-again-stocks-wilt-before-fed-239448&amp;sa=U&amp;ved=2ahUKEwjO-ZbLuOHjAhUBr48KHSApDvgQFjAFegQIBBAC&amp;usg=AOvVaw3Y8jTTDaVY7qnK939Bej7w">Federal Reserve</a> spoiled hopes of a run of US interest rate cuts.

A blizzard of global data and events was going on, but it was Fed Chair Jerome Powell's remarks on Wednesday that set the markets running. Powell said the first US rate cut in over a decade was "not the beginning of a long series of rate cuts".

The dollar’s reaction said it all. The DXY index surged to its highest in more than two years, euro/dollar dropped below $1.11 for the first time since May 2017, and Brexit-hobbled sterling hit 30-month lows just above $1.21.

World stocks had recoiled overnight and emerging markets had their longest run of falls in almost a year.

"Markets interpreted the Fed’s communication as slightly hawkish and therefore further rate cuts in the immediate future were somewhat priced out," said David Milleker, senior economic advisor at Union Investment. "And the dollar strengthened. All in all, the Fed did not achieve what it presumably wanted."

US Treasuries were sold off as investors scaled back their pre-Fed expectations for at least 100 basis points of cuts in the near term. Yields on 10-year notes climbed as high as 2.058% in Europe from a US close of 2.007%.

WATCH VIDEO

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Core eurozone bond yields were rising, too, although -0.428% German Bund levels were still extraordinary. "I didn’t say it’s just one rate cut," Powell had been careful to emphasise after Wednesday's 25-basis-point move.

Instead, he characterised it as "a mid-cycle adjustment to policy", citing signs of a global slowdown, US trade tensions and a desire to boost inflation.

Wall Street fell afterwards and E-minis futures for the S&amp;P 500 were pointing 0.15% lower.

MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.8%, extending losses for a fifth day to the lowest since mid-June and posting its biggest one-day percentage drop in a month.

Japan's Nikkei rose, reversing early declines. Australian shares declined 0.4%. Losses by Chinese shares ended down 0.8%.

"We believe the Fed is trying to thread the needle, balancing market jitters about slowing global growth with robust consumer spending and a strong job market in the US," said Nick Maroutsos, co-head of global bonds at Janus Henderson.

"In other words, by cutting just 25 bps, the Fed is trying to bolster market confidence while also keeping some dry powder in reserve in case of an economic shock."

Trade Talks

Adding to worries, the United States and China on Wednesday ended a brief round of talks without much progress in ending their year-long trade war.

Downbeat data and factory surveys on Thursday had also pointed to further weakness for Asia's trade-reliant economies.

South Korea's exports fell for an eighth straight month in July amid weak global demand and a dispute with Japan. New export orders shrank the most in about six years.

South Korea, the world's sixth-largest exporter, is the first major industrial economy to release trade data each month, providing an early assessment on the health of global demand.

Pressure on Chinese factories eased slightly, but manufacturing activity continued to shrink.

"The broader global trade dynamic remains a challenge," Morgan Stanley strategist Michael Zezas said. "Trade should continue to drag on corporate confidence, CapEx and global growth in the near term."

In Europe's foreign exchange markets, sterling dropped as low as $1.2101 before a Bank of England meeting that's expected to leave its 0.75% interest rate unchanged but result in plenty of interesting discussions.

Fears of a <a href="https://www.google.com/url?client=internal-uds-cse&amp;cx=006054055338965708568:09spwrlibei&amp;q=https://www.wionews.com/world/britain-to-spend-an-extra-26-billion-on-no-deal-brexit-planning-239860&amp;sa=U&amp;ved=2ahUKEwjd24uDu-HjAhUW8XMBHSfID2IQFjAAegQIBhAC&amp;usg=AOvVaw05e85f7pwO51L5lCnpMiS3">no-deal Brexit</a> now that Boris Johnson is prime minister continue to afflict the pound, although it was fractionally higher against a weakening euro at 91.17 pence.

"Sterling remains vulnerable to a further escalation in Brexit tensions and we anticipate the market will likely discount higher risks of a ‘no deal’ outcome in the weeks ahead," said Roger Hallam, currency chief investment officer at JP Morgan Asset Management.

Elsewhere, the Aussie dollar slipped below key chart support of $0.6832 to as low as $0.6828, a level not seen since an early January "flash crash".

The kiwi hit a six-week trough of $0.6535 on expectations the Reserve Bank of New Zealand will cut rates next week.

US crude futures fell 76 cents to $57.82 per barrel after comments on the rating outlook. Brent was down 71 cents at $64.34.

Spot gold also fell, to $1,405.26.

The dollar charged to its highest in more than two years on Thursday after the Federal Reserve spoiled hopes of a run of US interest rate cuts. A blizzard of global data and events was going on, but it was Fed Chair Jerome Powell's remarks on Wednesday that set the markets running.

The dollar charged to its highest in more than two years on Thursday after the Federal Reserve spoiled hopes of a run of US interest rate cuts. A blizzard of global data and events was going on, but it was Fed Chair Jerome Powell's remarks on Wednesday that set the markets running. Powell said the first US rate cut in over a decade was "not the beginning of a long series of rate cuts". The dollar’s reaction said it all. The DXY index surged to its highest in more than two years, euro/dollar dropped below $1.11 for the first time since May 2017, and Brexit-hobbled sterling hit 30-month lows just above $1.21. World stocks had recoiled overnight and emerging markets had their longest run of falls in almost a year. "Markets interpreted the Fed’s communication as slightly hawkish and therefore further rate cuts in the immediate future were somewhat priced out," said David Milleker, senior economic advisor at Union Investment. "And the dollar strengthened. All in all, the Fed did not achieve what it presumably wanted." US Treasuries were sold off as investors scaled back their pre-Fed expectations for at least 100 basis points of cuts in the near term. Yields on 10-year notes climbed as high as 2.058% in Europe from a US close of 2.007%. WATCH VIDEO × Core eurozone bond yields were rising, too, although -0.428% German Bund levels were still extraordinary. "I didn’t say it’s just one rate cut," Powell had been careful to emphasise after Wednesday's 25-basis-point move. Instead, he characterised it as "a mid-cycle adjustment to policy", citing signs of a global slowdown, US trade tensions and a desire to boost inflation. Wall Street fell afterwards and E-minis futures for the S&P 500 were pointing 0.15% lower. MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.8%, extending losses for a fifth day to the lowest since mid-June and posting its biggest one-day percentage drop in a month. Japan's Nikkei rose, reversing early declines. Australian shares declined 0.4%. Losses by Chinese shares ended down 0.8%. "We believe the Fed is trying to thread the needle, balancing market jitters about slowing global growth with robust consumer spending and a strong job market in the US," said Nick Maroutsos, co-head of global bonds at Janus Henderson. "In other words, by cutting just 25 bps, the Fed is trying to bolster market confidence while also keeping some dry powder in reserve in case of an economic shock." Trade Talks Adding to worries, the United States and China on Wednesday ended a brief round of talks without much progress in ending their year-long trade war. Downbeat data and factory surveys on Thursday had also pointed to further weakness for Asia's trade-reliant economies. South Korea's exports fell for an eighth straight month in July amid weak global demand and a dispute with Japan. New export orders shrank the most in about six years. South Korea, the world's sixth-largest exporter, is the first major industrial economy to release trade data each month, providing an early assessment on the health of global demand. Pressure on Chinese factories eased slightly, but manufacturing activity continued to shrink. "The broader global trade dynamic remains a challenge," Morgan Stanley strategist Michael Zezas said. "Trade should continue to drag on corporate confidence, CapEx and global growth in the near term." In Europe's foreign exchange markets, sterling dropped as low as $1.2101 before a Bank of England meeting that's expected to leave its 0.75% interest rate unchanged but result in plenty of interesting discussions. Fears of a no-deal Brexit now that Boris Johnson is prime minister continue to afflict the pound, although it was fractionally higher against a weakening euro at 91.17 pence. "Sterling remains vulnerable to a further escalation in Brexit tensions and we anticipate the market will likely discount higher risks of a ‘no deal’ outcome in the weeks ahead," said Roger Hallam, currency chief investment officer at JP Morgan Asset Management. Elsewhere, the Aussie dollar slipped below key chart support of $0.6832 to as low as $0.6828, a level not seen since an early January "flash crash". The kiwi hit a six-week trough of $0.6535 on expectations the Reserve Bank of New Zealand will cut rates next week. US crude futures fell 76 cents to $57.82 per barrel after comments on the rating outlook. Brent was down 71 cents at $64.34. Spot gold also fell, to $1,405.26.

Mind your backs, dollar coming through!

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