Crude oil prices are sliding with a
weaker-than-expected jobs report in the United States casting a cloud over
demand. The unemployment rate fell to 7.4% in July from 7.6% in June.
Indian rupee ended at an all-time closing low
of 61.10 to a dollar. Unchanged interest rates by the central bank, widening
current account deficit and poor policy response from the Government were
putting pressure on the rupee. According to Reserve Bank of India (RBI),
India's foreign exchange reserves shot up by $960.2 million to $280.17 billion
on the back of a healthy rise in currency assets in the week ended 26th July.
RBI Governor Duvvuri Subbarao said we will
roll back liquidity tightening measures only after we determine that stability
has been restored to the foreign exchange market. In the Reserve Bank's view,
undue volatility of the exchange rate is harmful for growth and stability, and
such volatility should be curbed.
The government’s move to ease foreign
investment norms and increase limit for FDI is likely to boost the confidence
of foreign investors, which in turn will provide much needed momentum to the
country’s economy.
Rubber prices closed mixed in thin trading as
market participants were winding down their holdings ahead of the long holidays.
Market remained quiet in tandem with the Tokyo Commodity Exchange, due to a
strong yen against the US dollar and declining Japanese equities. Asian rubber
prices were expected to drop further due to slow demand and rising supply from
Thailand.
The shortage of natural rubber and decrease
in production has pushed up the domestic prices. On Monday in the international
market the trend will be negative.
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