Latest news with #IFAGlobal
Reuters
3 days ago
- Business
- Reuters
Rupee nearly flat alongside subdued Asia FX; RBI policy decision awaited
MUMBAI, June 6 (Reuters) - The Indian rupee was nearly flat in early trading on Friday, tracking muted moves in regional currencies as traders awaited the Reserve Bank of India's monetary policy decision. The rupee was at 85.80 as of 09:20 a.m. IST, little changed from its close at 85.79 in the previous session. The RBI's policy decision is due at 10:00 a.m. IST, and the central bank is widely expected to cut rates by 25 basis points (bps) as muted inflation provides ample space to focus on boosting economic growth further. Asian currencies were mostly rangebound on the day, while the dollar index nudged higher to 98.8. Markets showed a muted reaction after U.S. President Donald Trump and Chinese leader Xi Jinping held a much anticipated call while leaving key issues unresolved for future talks. The offshore Chinese yuan was a tad lower at 7.1790. The rupee is expected to hover in the 85.75-86.20 range with a weakening bias in the near-term, FX advisory firm IFA Global said in a note. Dollar-rupee forward premiums, meanwhile, were steady in the run up to the RBI's policy announcement, with the 1-year implied yield at 1.91%. The announcement of fresh measures to inject rupee liquidity into the banking system or dovish commentary from the central bank could push forward premiums lower, a trader at a Mumbai-based bank said. The trader expects the 1-year implied yield to find support at 1.85% in the near term. India's benchmark 10-year bond yield was little changed at 6.1985% while the benchmark equity index, the Nifty 50 (.NSEI), opens new tab, was nearly flat as well on Friday. Later in the day, the focus will be on the release of U.S. non-farm payrolls data, which will offer cues on how trade uncertainty is impacting the U.S. economy and affecting the outlook for rate cuts by the Federal Reserve.
&w=3840&q=100)
Business Standard
22-05-2025
- Business
- Business Standard
Rupee drops to one-month low on FPI selling and stop-loss triggers
The rupee on Thursday depreciated to a one-month low against the dollar, following foreign outflows from domestic equities coupled with stop-losses being triggered at the 85.70 per dollar mark, said dealers. The local currency depreciated to as much as 86.11 per dollar during the day before settling at 86 per dollar—the weakest level since 11 April this year. On Wednesday, the rupee had settled at 85.64 per dollar. 'Today's move in USDINR was primarily due to stop-losses getting triggered above the 85.70 level and likely outflows from domestic equities (FII/FPI selling). However, the broad trend is that of dollar weakness,' said Abhishek Goenka, chief executive officer at IFA Global. Dollar bids from foreign banks and state-owned banks further weighed on the rupee during the day, said dealers. 'In the near term, the rupee may depreciate towards 86.50–86.60. However, a medium-term appreciation remains possible, supported by a weaker dollar and strong Indian macro fundamentals,' said the treasury head at a private bank. On the other hand, government bond yields continued to fall on expectations of a record surplus transfer by the Reserve Bank of India (RBI) to the government for FY25. The yield on the benchmark 10-year bond softened by 1 basis point to 6.24 per cent on Thursday. The yield on the new 10-year government bond softened to 6.20 per cent during the day before inching up to 6.23 per cent, as traders sold the bond at a profit after the initial fall in yields. On Wednesday, the new 10-year bond had settled at 6.21 per cent. The benchmark yield has softened by 33 basis points so far in the current financial year. 'There was profit booking in the last hour,' said a dealer at a primary dealership. 'Mainly PSU banks were booking profit today (Thursday),' he added. Market participants said that foreign portfolio investors are expected to continue their selling spree given the narrowing spread between the domestic 10-year government bond yield and the benchmark US 10-year bond yield. The spread narrowed to a 20-year low of 164 basis points on Thursday, as yields on US Treasuries surged amid concerns over the fiscal deficit. According to Bloomberg data, this is the narrowest spread since 28 July 2004.
Economic Times
17-05-2025
- Business
- Economic Times
Rupee weakens amid Operation Sindoor, but no panic yet: IFA Global's Goenka
Live Events (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel Since the liberation day, i.e., 2nd April, when the Trump administration announced reciprocal tariffs, to 7th May, when Indian armed forces launched operation Sindoor , the Rupee had already been underperforming its the Rupee had strengthened only 0.8% against the Dollar during that period, its Asian peers had appreciated anywhere between 3-5% (The Taiwanese Dollar was an outlier and had appreciated 9%)Since 7th May, when the operation Sindoor was launched, the Rupee has weakened by 1.1%.Most Asian currencies have also weakened during this period. In perspective, the Thai Baht and the Malaysian Ringgit have also weakened by 1.1% and 1.6% respectively in the same there has not been a major idiosyncratic impact, kind of what one would expect with a military escalation like RBI has most likely stepped in to curb runaway depreciation , which is something one would a much stronger external position now than a decade ago, we are now much better placed to withstand periods of stress, especially over short periods of a few given the dire straits the Pakistani economy is in and the wide gap between its military prowess and ours, the conflict does not look like extending for a prolonged have not sold Indian assets frantically in panic until now, and we believe they will objectively evaluate the situation as it unfolds. We do not see a scenario wherein FPIs dump Indian assets in panic. The first signs of de-escalation may throw open the floodgates of FPI flows. We believe that after the conflict ends, India's perception as a country with strong economic potential, stable pro-growth governance, formidable military prowess, and considerable international diplomatic influence will be reinforced.A bit of Rupee underperformance, like what we are seeing now, could well be a blessing in disguise given the ongoing trade war between the US and other countries. It might just give us a competitive edge in lapping up the manufacturing opportunity that could be coming our the current RBI regime seems to be more tolerant of allowing two-sided movement in USD/INR, we believe it will not allow runaway depreciation of the Rupee, at least not on account of idiosyncratic factors. We expect the Rupee to trade in an 84.50-87.00 range over the next 5 weeks or are advising importers and exporters not to overhedge and also take into account possible temporary delays/business disruptions on account of supply chain impact, especially in North and West India.(The author is Founder and CEO IFA Global): Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
Business Recorder
12-05-2025
- Business
- Business Recorder
Indian stocks log best day in 4 years on border truce; Pakistan shares surge
Indian shares logged their best session in more than four years on Monday, surging nearly 4% in a broad-based relief rally after the country reached and held a fragile ceasefire with Pakistan over the weekend after days of cross-border clashes. The Nifty 50 closed 3.82% higher at 24,924.70 points and the BSE Sensex rose 3.74% to 82,429.90, marking their biggest single-day gains since February 1, 2021. Across the border, Pakistan's benchmark KSE-100 share index rocketed 9.4%, coming off a trading halt earlier. The de-escalation in the conflict, which erupted in earnest in the middle of last week, is unlikely to leave a lasting impact on India, the world's fifth-largest economy, and has shifted investor focus back to economic fundamentals, analysts said. The volatility index, nicknamed the 'fear gauge', snapped an eight-day rising streak, a sign of relief among investors. Border conflict worry erases $83 billion from Indian equities in two days 'With the first sign of de-escalation, we are likely seeing the floodgates open in terms of foreign inflows as the global risk-sentiment is also turning positive on easing trade tensions,' said Abhishek Goenka, founder and CEO of IFA Global. Global stocks also rose after the United States and China agreed to temporarily slash reciprocal tariffs in a deal that surpassed expectations as the world's two biggest economies seek to end a damaging trade war that has stoked fears of recession and roiled financial markets. All 13 major sectors in India finished higher. The biggest gainers with a 6.7% jump were IT companies, which earn a substantial chunk of revenue from the US. The broader small-cap and mid-caps rallied 4.2% and 4.1%, respectively. Analysts, though, said a local holiday in some parts of the country could have led to exacerbated gains.
&w=3840&q=100)
Business Standard
08-05-2025
- Business
- Business Standard
Rupee erases 2025 gains as tensions with Pakistan trigger sell-off
The rupee erased all its 2025 gains on Thursday after logging its steepest single-day decline in more than two years, as investors fled to safe-haven assets amid escalating tensions between India and Pakistan. India confirmed that it had shot down missiles launched from Pakistan and retaliated by targeting air defence radars and systems at multiple locations in the neighbouring country, including neutralising an air defence system in Lahore. The domestic currency depreciated to 85.79 per dollar, a 1.03 per cent drop—its sharpest fall since February 2023. The 10-year government bond yield rose 6 basis points (bps) to 6.40 per cent, while the Sensex declined 412 points, or 0.51 per cent, to close at 80,335. Twenty-three of its constituents ended in the red. India VIX, the volatility index, surged 10 per cent to 21.01, its highest since April 9. The weekly index expiry further fuelled market volatility. 'This [rupee's weakening] was triggered primarily by rising geopolitical tensions following India's military action against targets in Pakistan and Pakistan-administered Kashmir,' said Abhishek Goenka, chief executive officer of IFA Global. 'Pakistan's claim of shooting down multiple Indian drones added to the uncertainty, sparking a flight to safety and increasing demand for the US dollar. However, any signs of de-escalation—likely under international pressure—could normalise markets and lead to rupee recovery, especially since FII inflows into equities remain strong,' he added. Following Thursday's fall, the Indian unit has now declined 0.12 per cent against the US dollar for the calendar year and 0.29 per cent for the financial year. Until Wednesday, the rupee had been up 0.92 per cent year-to-date and 0.75 per cent in the fiscal year. Traders noted panic dollar buying after India stated that it had neutralised Pakistan's attempts to target several military installations in the country's northern and western regions between Wednesday and early Thursday. 'Today morning, Indian Armed Forces targeted air defence radars and systems at a number of locations in Pakistan. The Indian response has been in the same domain with the same intensity as Pakistan. It has been reliably learnt that an air defence system at Lahore has been neutralised,' a press release from the Press Information Bureau said. The release added that Pakistan attempted to engage military targets in Srinagar, Amritsar, Chandigarh and Bhuj using drones and missiles, which were neutralised. A rise in crude oil prices and a stronger US dollar further weighed on the rupee. The dollar index was up 0.46 per cent at 100.07 on Thursday after the US Federal Reserve left interest rates unchanged at 4.25–4.50 per cent and warned of persistent inflation and economic uncertainty. The index tracks the greenback's performance against six major currencies. Bond yields also inched up following India's statement on rising tensions. 'In the morning, the yields were actually down because of the Open Market Operation (OMO) auction, then this news came and there was selling,' said the treasury head at a private bank. 'We might see some more selling on Friday because of the weekend,' he added. The RBI plans to purchase Rs 25,000 crore worth of government securities through an OMO auction on Friday. Bond dealers said the RBI's ongoing liquidity infusion has helped support market sentiment and limit losses. 'Despite the news, we were near 6.30 per cent, but with escalation, we can't predict where yields will move from here. Overall, the bond market still maintains a positive outlook,' said the treasury head at another private bank.
