Rupee Off 4-Month High, Posts Biggest Single-Day Loss In 3 Months: 10 Points

Rupee Off 4-Month High, Posts Biggest Single-Day Loss In 3 Months: 10 Points
Rupee vs dollar: The rupee registered a weekly gain of 25 paise against the greenback
  1. Crude oil prices jumped by more than 5 per cent after the US and China agreed to a 90-day truce in a trade dispute. Brent - the global benchmark for crude oil - rose by $3.14 to hit $62.60 at the day's highest level.
  2. In the G20 meeting during the weekend, China and the US agreed not to impose additional trade tariffs for at least 90 days while they hold talks to resolve existing disputes. The trade war between the world's two biggest economies has weighed heavily on global trade, sparking concerns of an economic slowdown.
  3. The spike in crude oil price comes ahead of a key OPEC or Organization of the Petroleum Exporting Countries meeting this week, in which the producers' group is expected to reduce supply.
  4. Analysts say weak macroeconomic data along with rising oil prices dragged the currency lower.
  5. "The rupee has declined on account of sharp rebound in the crude oil prices in the international market. Further India's GDP and fiscal deficit data disappointed the market. Hence the rupee is under pressure," said Rushabh Maru, research analyst, Anand Rathi Shares and Stock Brokers.
  6. GDP growth slowed to 7.1 per cent in the July-September, from 8.2 per cent in the previous quarter, official data showed last week. Separate data showed that the full-year fiscal deficit target of Rs 6.24 lakh crore was breached at October-end, mainly on account of lower revenue collections.
  7. Investors will closely watch the outcomes of key Reserve Bank of India and OPEC meetings, say analysts.
  8. “The rupee is underperforming as crude prices have ticked higher... The quantum of cut will only be revealed in the OPEC meeting later this week,” said IFA Global, a forex advisory firm.
  9. The central bank is due to release its bi-monthly policy statement on Wednesday. The RBI is likely to raise interest rates once next year, after raising them twice this year, according to a poll by news agency Reuters.
  10. Meanwhile, equity markets registered mild gains on Monday, with key indices Sensex and Nifty rising for the sixth consecutive session.
Share
Unlock this article for free
Sign up to access exclusive stories, fewer ads, and a personalised experience.
Live TV
Apps
Social
Hello Reader
Sign In / Register
Set as Trusted Source
on Google Search
Add NDTV Profit As Google Preferred Source