Rupee Drops 36 Paise Against US Dollar: 10 Things To Know

1. The RBI said on Monday it has decided to purchase a total of Rs 36,000 crore worth government bonds under its open market operations (OMOs) this month, in a bid to ease liquidity conditions in the market. The auctions would be conducted during the second, third and fourth week of October. 
2. Bond yields dropped sharply on Monday to their lowest in more than a month as investors took in the news.
3. The RBI is likely to raise interest rates in early October to prop up a retreating rupee, according to a Reuters poll of economists. The predicted rate hike would be the RBI's third this year, having lifted borrowing costs in June and August. 
4. Domestic factory activity expanded more quickly in September on strong domestic and export order growth, a business survey showed. It is a welcome sign of strength as policy makers worry about a sharp drop in the rupee and fallout from global trade frictions.
5. The government will borrow gross Rs 2.47 lakh crore from the market between October and March through dated securities, Economic Affairs Secretary Subhash Chandra Garg said on Friday.
6. The government has recently raised import tariffs on 19 non-essential items to reduce the widening current account deficit and tackle a sharp slide in the rupee.
7. The rupee has weakened by more than 13 per cent against the dollar so far this year.
8. Globally, oil prices gained on Monday, with international benchmark Brent hitting a four-year high, as US sanctions on Tehran squeezed Iranian crude exports, tightening supply even as other key exporters increased production.
9. Meanwhile, domestic stock markets swung between gains and losses on Monday. In late afternoon trade, the S&P BSE Sensex over 300 points to touch 36,535.49, on the back of gains in IT, metal and PSU banking stocks.
10. On Friday, the rupee had risen marginally to settle at 72.48 against the greenback. With that, the rupee closed the month with a loss of 2.1 per cent. (With inputs from agencies)

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