Skip to content
Hindi News, हिंदी समाचार, Samachar, Breaking News, Latest Khabar – Pratirodh

Hindi News, हिंदी समाचार, Samachar, Breaking News, Latest Khabar – Pratirodh

Primary Menu Hindi News, हिंदी समाचार, Samachar, Breaking News, Latest Khabar – Pratirodh

Hindi News, हिंदी समाचार, Samachar, Breaking News, Latest Khabar – Pratirodh

  • Home
  • Newswires
  • Politics & Society
  • The New Feudals
  • World View
  • Arts And Aesthetics
  • For The Record
  • About Us
  • Featured
  • Politics & Society

Slowing Indian Economy Spells Tough Times Ahead For The Rupee: Reuters Poll

Nov 7, 2019 | Pratirodh Bureau

FILE PHOTO: A cashier checks Indian rupee notes inside a room at a fuel station in Ahmedabad on September 20, 2018

A slowing domestic economy will prevent India’s rupee from recouping this year’s losses against the dollar in 2020, with optimism around an easing in the U.S.-China trade dispute not enough to give it a further boost, a Reuters poll showed.

After falling nearly 9% in 2018, the Indian currency has shed another 4% this year to touch a 2019 trough of 72.40 per dollar on Sept 3. It has since popped up over 2%, along with other emerging market currencies, on hopes of a possible trade deal between the world’s two largest economies.

But nothing has been agreed yet, let alone a meeting scheduled.

A barrage of rate cuts from the Reserve Bank of India this year – five reductions in succession for a total of 135 basis points off the repo rate, now at 5.15% – has done nothing concrete so far to revive a slowing Indian economy.

Neither have several government fiscal stimulus measures introduced this year, which have become a negative for the rupee’s outlook given it will be difficult for Prime Minister Narendra Modi’s government to meet its fiscal deficit targets.

“We expect the INR to weaken as risks of sluggish growth and fiscal slippage intensify,” said Rini Sen, India economist at ANZ.

“Stable portfolio flows led by equities and global cues like trade negotiations, on top of rate cuts, have led to bouts of optimism. However, we think the currency market is under-pricing downside risks to domestic growth.”

The Nov. 1-6 Reuters poll of over 40 strategists predicted the rupee to weaken about 1.3% to 71.90 against the greenback in 12 months from around 71.00 on Wednesday.

The RBI, the most aggressive major central bank in the world this year for easing, is expected to cut the repo rate at its sixth meeting in a row in December, a Reuters poll showed last month, which could put further pressure on the currency.

“Unlike the previous cuts, additional cuts could erode the allure of the rupee as a higher yielder, while (the) growth prospect remains a concern,” said Saktiandi Supaat, head of foreign exchange research at Maybank based in Singapore.

Indian economic growth has steadily slowed to a six-year low of 5.0% in the April-June quarter from an 8.1% peak in the January-March quarter of 2018 and recent business surveys indicate it will slow further.

While the year-ahead consensus in the latest poll was slightly stronger than 72.50 per dollar predicted last month, it reflects the currency’s gain over the past month.

However, nearly two-thirds of 24 common contributors in the October and November Reuters polls either downgraded or kept their year-ahead forecasts unchanged.

Currency speculators have cut short bets on the rupee to the lowest since mid-August, a separate Reuters poll showed.

The rupee’s outlook was also driven by renewed interest among foreign portfolio investors for Indian assets. They bought 160.69 billion rupees of Indian securities in October, the highest in six months, according to Foreign Portfolio Investors’ data.

“If whatever measures taken by the government so far do not result in improving the onshore growth scenario, then there is risk that whatever portfolio flows which have come so far might reverse…and could result in INR weakness,” said Rohit Garg, emerging market FX strategist at BofAML based in Singapore.

Tags: Currency speculators, emerging market currencies, fiscal deficit targets, india, indian currency, prime minister narendra modi, repo rate, Reserve Bank of India, slowing economy, U.S.-China trade dispute

Continue Reading

Previous Schools In New Delhi Reopen, Air Quality Still Unhealthy
Next Delhi Police Protest Darkest Day In History, Arrest Guilty Policemen In A Week, Says Bar Council Of India

More Stories

  • Featured

Zelenskyy Opens Cannes Film Festival, Links War And Cinema

5 hours ago Pratirodh Bureau
  • Featured

The Rocky Road To Social Media Independence

5 hours ago Pratirodh Bureau
  • Featured

Pollution: Over 23.5 Lakh Premature Deaths In India In 2019

20 hours ago Pratirodh Bureau

Recent Posts

  • Zelenskyy Opens Cannes Film Festival, Links War And Cinema
  • The Rocky Road To Social Media Independence
  • Pollution: Over 23.5 Lakh Premature Deaths In India In 2019
  • Rajiv Gandhi Assassination: SC Orders Release Of Convict
  • Not Allowed To Enter Chandigarh, Farmers Sit On Protest Near border
  • ‘Who Are You?’: SC Questions Locus Of Hindu NGO Office Bearer
  • Borne Becomes France’s Second Woman PM
  • India Rejects Pak’s ‘Farcical’ Resolution On J&K
  • ‘Ban On Wheat Exports Anti-Farmer Move’
  • Shivling Claim An Attempt To Create Communal Disharmony: AIMPLB
  • Farmers Turn To Millets To Fight Water Stress, Climate Change
  • BJP Works To Create Divide, Two Indias: Rahul
  • ‘Cryptos Can Lead To Dollarisation Of Economy’
  • Delhi Turns Into Hot Cauldron At 49 Degrees C
  • Ukraine Opens 1st War Crimes Trial Of Captured Russian Soldier
  • Nuking Pakistan Better Than Giving Power To Thieves: Imran Khan
  • Slain Kashmiri Pandit Cremated Amid Protests Against BJP
  • Climate Change Is Making Floods Worse Too
  • Lessons For Ukraine From The Rohingya Crisis
  • ‘Our Mountains Are Gone’: Grief As Sacred New Mexico Forests Burn

Search

Main Links

  • Home
  • Newswires
  • Politics & Society
  • The New Feudals
  • World View
  • Arts And Aesthetics
  • For The Record
  • About Us

Related Stroy

  • Featured

Zelenskyy Opens Cannes Film Festival, Links War And Cinema

5 hours ago Pratirodh Bureau
  • Featured

The Rocky Road To Social Media Independence

5 hours ago Pratirodh Bureau
  • Featured

Pollution: Over 23.5 Lakh Premature Deaths In India In 2019

20 hours ago Pratirodh Bureau
  • Featured

Rajiv Gandhi Assassination: SC Orders Release Of Convict

20 hours ago Pratirodh Bureau
  • Featured

Not Allowed To Enter Chandigarh, Farmers Sit On Protest Near border

1 day ago Pratirodh Bureau

Recent Posts

  • Zelenskyy Opens Cannes Film Festival, Links War And Cinema
  • The Rocky Road To Social Media Independence
  • Pollution: Over 23.5 Lakh Premature Deaths In India In 2019
  • Rajiv Gandhi Assassination: SC Orders Release Of Convict
  • Not Allowed To Enter Chandigarh, Farmers Sit On Protest Near border
Copyright © All rights reserved. | CoverNews by AF themes.