Hopes of a rebound in India’s currency will probably have to be postponed. The rupee was battered all of last week. And there was no respite on Monday either, when it fell to yet another record low. The currency tumbled during the day to close trade at Rs 55.03 to the US dollar. The rupee is Asia’s worst performing currency and traders expect it to get beaten further because of falling confidence in India. Another pressure on the rupee is high dollar demand from oil firms and other companies.
And in other news, the government has taken a step towards tackling the problem of black money. After relentless criticism from activists and the opposition, the UPA on Monday tabled a white paper with several strong recommendations. For one, the paper suggested greater punishments for dealing in black money or storing it. It also called for more scrutiny of sectors of the economy that it said were especially entwined in black money deals.
Rupee falls to new low; UPA releases white paper on black money; markets make modest gains on Monday
And finally, while the rupee may be down and sentiment may remain poor, Indian markets managed to make gains on Monday. The Sensex climbed 31 points to 16,183. And the Nifty inched up 15 to 4,906.