ADVERTISEMENT
Rupee Falls To All-Time Closing Low Of 73.58 Against Dollar: 10 Things To Know
04 Oct 2018, 07:21 PM IST 
The rupee registered a new all-time low of 73.81 during Wednesday's session
- The rupee has been falling since three consecutive days ahead of the Reserve Bank of India's fourth bi-monthly policy statement due on Friday.
- Brent crude oil futures were trading above the $86 per barrel mark on Thursday, not far from a late 2014 high of $86.74 registered the previous day.
- In the latest of a series of attempts to calm the markets, the government late on Wednesday said it would allow state oil-marketing companies (OMCs) to raise $10 billion in overseas loans to help them cover the sharp rise in price for imported oil.
- The move is likely to have little impact on the currency market, according to forex advisory firm IFA Global.
- Analysts expect the rupee to continue to remain under pressure going forward. "In the face of US sanctions on oil supply from Iran becoming effective next month, oil continues to firm up. India's current account deficit continues to be vulnerable," said Salil Datar, executive director and CEO, Essel Forex.
- The RBI has said it would pump Rs 36,000 crore ($4.95 billion) into money markets in October. "The RBI announcements on the liquidity are more focused towards providing relief to the NBFCs and banks rather than towards cooling down of the rupee in the forex markets," Mr Datar added.
- High crude oil prices and rupee depreciation tends to widen the current account deficit. India meets more than 80 per cent of its oil requirements through imports.
- The Reserve Bank of India will conclude a three-day bi-monthly monetary policy review on Friday. All eyes will be on the central bank's statement due at 2:30 pm on Friday.
- Economists expect the central bank to hike the repo rate - the key interest rate at which it lends short-term funds to commercial banks - by 25 basis points. If the Monetary Policy Committee goes ahead with a hike, that would mark the third consecutive increase in the repo rate. At present, the repo rate stands at 6.50 per cent.
- Meanwhile, the government on the same day announced a reduction of Rs 2.5 per litre in domestic petrol and diesel prices. The cut is a result of a reduction in the excise duty of Rs 1.50 per litre, with oil-marketing companies taking a revenue hit of 1 rupee per litre, Finance Minister Arun Jaitley said.
(With agency inputs)
