Modi to hold a meeting this weekend over rupee, oil prices
The government may announce measures to support rupee after a planned review of the economy by PM Narendra Modi this weekend
Mumbai: The rupee jumped the most in three weeks and stocks rallied after an official said the government may announce measures to support the currency after a planned review of the economy by Prime Minister Narendra Modi this weekend.
The measures will probably include steps to curb the decline in the rupee and oil prices, the official told reporters in New Delhi, asking not to be identified citing rules. The rupee has slumped to a succession of record lows in the past three months amid a sell-off in emerging markets and concern about India’s current account deficit. An unnamed Indian government official said monetary measures not ruled out, according to news channels.
India will also release its August inflation data later today, which is expected below the Reserve Bank of India’s medium-term target.
“The market is seeing a temporary relief and moving on hope,” Sajal Gupta, head of foreign exchange and rates at Edelweiss Securities in Mumbai. “Market players will now be keenly watching the government moves. If the moves are credible, we’ll see the rally continuing, and if the moves not credible, we’ll see the pain return very swiftly.”
The rupee strengthened as much as 0.6% to 72.2650 per dollar after sliding to an all-time low of 72.9138 in earlier trading. The benchmark S&P BSE Sensex index climbed 0.6%, while benchmark 10-year bond yields climbed two basis points to 8.20%.
One basis point is one-hundredth of a percentage point.
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