Buzz Update Rupee plunges below 78-mark against USD TOU

Buzz Update Rupee plunges below 78-mark against USD

Rupee plunges below 78-mark against USD

Tribune News Service

New Delhi, June 13

A global stock market meltdown had an impact on Indian bourses that fell 2.68 per cent while the rupee fell to a fresh lifetime low of 78.04 against the dollar on Monday. But there was a slight reprieve from high prices as retail inflation eased to 7.04 per cent in May as against 7.79 per cent in April.


CLOSES AT 52,846.70

  • NSE Nifty sheds 427.40 points to close at 15,774.40
  • Bajaj Finserv the biggest loser, followed by Bajaj Finance and IndusInd Bank

Investors lose Rs 6.64 lakh cr

Rupee vs US dollar

Rupee depreciates 11 paise to close at a fresh lifetime low of 78.04 against the US dollar

What weaker Rs means

  • Education abroad now becomes more expensive
  • Fuel prices may witness an increase if inflation rules above RBI’s benchmark
  • RBI may again hike interest rates, making home and auto loans more expensive
  • Stock markets remain weak till US Fed announces rate hike

Retail inflation eases

  • 7.04% India’s consumer inflation in May
  • 7.79% of the figure for the previous month
  • ‘Food basket’ inflation at 7.97% in May against 8.31% in April

Dalal Street saw investor wealth falling by over Rs 6.64 lakh crore as market capitalization of BSE-listed companies dropped to Rs 2.45 lakh crore. Analysis attributed the fall to volatile crude oil prices that touched $ 120 a barrel. The downtrend was witnessed in several sectors and especially hit Bajaj Finserv, TCS, NTPC, SBI, Tech Mahindra and Infosys.

Global markets saw a sharp sell-off after the US consumer inflation for May accelerated to a four-decade high of 8.6 per cent. Foreign institutional investors (FIIs) began shifting funds to the US where a Fed interest rate hike is imminent to check inflation that has touched 8.6 per cent due to higher food and gas prices. The FIIs offloaded shares worth Rs 4,164.01 crore on Monday, according to stock exchange data. The 30-share BSE Sensex fell 1,456.74 points to end at 52,846.70. The impact was passed on to the rupee, which witnessed an intra-day high of 78.02 against the US dollar on Monday, but closed at its all-time low of 78.04, down 11 paise over its previous close of 77.93.

“The spillovers from global commodities and food will continue to add stress to domestic prices. We do not see inflation cooling down in the near term,” said Vivek Rathi of Knight Frank India.

Sriram Iyer from Reliance Securities said the rupee posted a record closing as surge in US inflation raised speculation about higher interest rates in America.

In some relief to consumers, softened prices led to inflation in the food basket in May at 7.97 per cent, down from 8.31 per cent in the previous month. In the ‘cereals and products’ segment, the rate of inflation eased to 5.33 per cent as against 5.96 per cent in April.

A similar trend was witnessed in the ‘oil and fats’ segment where the fall was from 17.27 per cent to 13.26 per cent and in fruits from 4.99 per cent to 2.33 per cent. However, vegetable prices accelerated to 18.26 per cent as against 15.41 per cent in April.

Retail inflation, however, remained above the RBI’s target for the fifth consecutive month. Analysts felt this means that the RBI, which factors in the inflation rate, will hike the repo rate at its next monetary policy meeting in August.

!function (f, b, e, v, n, t, s) {
if (f.fbq) return; n = f.fbq = function () {
n.callMethod ?
n.callMethod.apply(n, arguments) : n.queue.push(arguments)
if (!f._fbq) f._fbq = n; n.push = n; n.loaded = !0; n.version = ‘2.0’;
n.queue = []; t = b.createElement(e); t.async = !0;
t.src = v; s = b.getElementsByTagName(e)[0];
s.parentNode.insertBefore(t, s)
}(window, document, ‘script’,
fbq(‘init’, ‘233432884227299’);
fbq(‘track’, ‘PageView’);

if you want to read this article from the original credit source of the article then you can read from here.

Best Offer Mansoon Sell Today Up to 75% Off

Leave a Reply