rupee continues to rise, many hope its only for a short … continues to rise, many hope its only...

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5/2/2017 Rupee continues to rise, many hope its only for a short term | Zee Business http://www.zeebiz.com/india/newsrupeecontinuestorisemanyhopeitsonlyforashortterm15515 1/5 Home Home (/) (/) » » India News India News (/india) (/india) Rupee continues to rise, many hope its only for a short term Rupee continues to rise, many hope its only for a short term Overall, Indian Rupee has appreciated 5.4% in the current Úscal year. Photo: IANS Overall, Indian Rupee has appreciated 5.4% in the current Úscal year. Photo: IANS By By Pooja Jaiswar Pooja Jaiswar (/authors/pooja-jaiswar-3099) (/authors/pooja-jaiswar-3099) Updated: Fri, Apr 28, 2017 Updated: Fri, Apr 28, 2017 03:56 pm 03:56 pm Mumbai, ZeeBiz WebDesk Mumbai, ZeeBiz WebDesk (https://twitter.com/share?url=http://www.zeebiz.com/india/newsrupeecontinuestorisemanyhopeitsonlyforashortterm (https://twitter.com/share?url=http://www.zeebiz.com/india/newsrupeecontinuestorisemanyhopeitsonlyforashortterm 15515&text=Rupee+continues+to+rise%2C+many+hope+its+only+for+a+short+term) 15515&text=Rupee+continues+to+rise%2C+many+hope+its+only+for+a+short+term) (https://www.facebook.com/sharer/sharer.php?u=http://www.zeebiz.com/india/newsrupeecontinuestorisemanyhopeitsonlyforashortterm15515) (https://www.facebook.com/sharer/sharer.php?u=http://www.zeebiz.com/india/newsrupeecontinuestorisemanyhopeitsonlyforashortterm15515) (https://plus.google.com/share?url=http://www.zeebiz.com/india/newsrupeecontinuestorisemanyhopeitsonlyforashortterm15515) (https://plus.google.com/share?url=http://www.zeebiz.com/india/newsrupeecontinuestorisemanyhopeitsonlyforashortterm15515) Indian Rupee is appreciating like art during an economic downturn. Indian Rupee is appreciating like art during an economic downturn. The INR has hit a 21-month high of 63.93 per dollar. after moving past 65-mark in the beginning of April. The INR has hit a 21-month high of 63.93 per dollar. after moving past 65-mark in the beginning of April. Overall, Indian Rupee has appreciated 5.4% in the current Úscal year. Overall, Indian Rupee has appreciated 5.4% in the current Úscal year. A total of Rs 21,886 crore has been invested in Indian markets – among which debt market has seen inÛows of Rs 19,469 crore and remaining A total of Rs 21,886 crore has been invested in Indian markets – among which debt market has seen inÛows of Rs 19,469 crore and remaining Rs 2,417 crore pushed in equities market. Rs 2,417 crore pushed in equities market. Analysts at Kotak Institutional Equities expect Rupee to remain strong for another one-two months led by foreign Ûows. Analysts at Kotak Institutional Equities expect Rupee to remain strong for another one-two months led by foreign Ûows. Vinod Nair, Head Of Research at Geojit Financial Services said, "Risk will emerge if we continue to outperform other EMs in the long-term, Vinod Nair, Head Of Research at Geojit Financial Services said, "Risk will emerge if we continue to outperform other EMs in the long-term, whereas this is an intermediary phenomenon led by strong FIIs inÛow post the overwhelming state election result which will stabilize in the whereas this is an intermediary phenomenon led by strong FIIs inÛow post the overwhelming state election result which will stabilize in the near-term." near-term." Appreciation of the rupee is usually a negative trend for the export driven businesses like IT services, automobile, textiles & garments, gems Appreciation of the rupee is usually a negative trend for the export driven businesses like IT services, automobile, textiles & garments, gems & jewelry and pharmaceuticals. On the other hand, the importers tend to beneÚt from appreciation of the Rupee against the Dollar. & jewelry and pharmaceuticals. On the other hand, the importers tend to beneÚt from appreciation of the Rupee against the Dollar. (http://www.zeebiz.com/india/news- (http://www.zeebiz.com/india/news- can- can- a- a- campaign- campaign- to- to- remove- remove- tax- tax- on- on- sanitary- sanitary- pads- pads- help- help- women- women- adopt- adopt- better- better- hygiene- hygiene- 15513? 15513? pfrom=prev- pfrom=prev- article) article) (http: (http: call- call- drop- drop- rates rates worse worse in- in- april- april- 15516 15516 pfrom pfrom articl articl (/) (/) (https://www.facebook.com/Zeebusinessonline/) (https://www.facebook.com/Zeebusinessonline/) (https://twitter.com/zeebusiness) (https://twitter.com/zeebusiness) (https://www.youtube.com/channel/UCkXopQ3ubd- (https://www.youtube.com/channel/UCkXopQ3ubd- rnXnStZqCl2w) rnXnStZqCl2w) LIVE TV LIVE TV (/LIVE-TV) (/LIVE-TV)

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Page 1: Rupee continues to rise, many hope its only for a short … continues to rise, many hope its only for a short term Overall, Indian Rupee has appreciated 5.4% in the current Úscal

5/2/2017 Rupee continues to rise, many hope its only for a short term | Zee Business

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HomeHome (/) (/) » » India NewsIndia News (/india) (/india)

Rupee continues to rise, many hope its only for a short termRupee continues to rise, many hope its only for a short term

Overall, Indian Rupee has appreciated 5.4% in the current scal year. Photo: IANSOverall, Indian Rupee has appreciated 5.4% in the current scal year. Photo: IANS

By By Pooja Jaiswar Pooja Jaiswar (/authors/pooja-jaiswar-3099)(/authors/pooja-jaiswar-3099)

Updated: Fri, Apr 28, 2017Updated: Fri, Apr 28, 2017 03:56 pm03:56 pm

Mumbai, ZeeBiz WebDeskMumbai, ZeeBiz WebDesk

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Indian Rupee is appreciating like art during an economic downturn. Indian Rupee is appreciating like art during an economic downturn. 

The INR has hit a 21-month high of 63.93 per dollar. after moving past 65-mark in the beginning of April. The INR has hit a 21-month high of 63.93 per dollar. after moving past 65-mark in the beginning of April. 

Overall, Indian Rupee has appreciated 5.4% in the current scal year. Overall, Indian Rupee has appreciated 5.4% in the current scal year. 

A total of Rs 21,886 crore has been invested in Indian markets – among which debt market has seen in ows of Rs 19,469 crore and remainingA total of Rs 21,886 crore has been invested in Indian markets – among which debt market has seen in ows of Rs 19,469 crore and remaining

Rs 2,417 crore pushed in equities market.Rs 2,417 crore pushed in equities market.

Analysts at Kotak Institutional Equities expect Rupee to remain strong for another one-two months led by foreign ows. Analysts at Kotak Institutional Equities expect Rupee to remain strong for another one-two months led by foreign ows. 

Vinod Nair, Head Of Research at Geojit Financial Services said, "Risk will emerge if we continue to outperform other EMs in the long-term,Vinod Nair, Head Of Research at Geojit Financial Services said, "Risk will emerge if we continue to outperform other EMs in the long-term,

whereas  this is an intermediary phenomenon led by strong FIIs in ow post the overwhelming state election result which will stabilize in thewhereas  this is an intermediary phenomenon led by strong FIIs in ow post the overwhelming state election result which will stabilize in the

near-term."near-term."

Appreciation of the rupee is usually a negative trend for the  export driven businesses like IT services, automobile, textiles & garments, gemsAppreciation of the rupee is usually a negative trend for the  export driven businesses like IT services, automobile, textiles & garments, gems

& jewelry and pharmaceuticals. On the other hand, the importers tend to bene t from appreciation of the Rupee against the Dollar.& jewelry and pharmaceuticals. On the other hand, the importers tend to bene t from appreciation of the Rupee against the Dollar.

  

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Page 2: Rupee continues to rise, many hope its only for a short … continues to rise, many hope its only for a short term Overall, Indian Rupee has appreciated 5.4% in the current Úscal

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Earlier, Care Ratings had  said,    "Exports lose their shine as the competitive edge is lost. The rupee has already been one of the bestEarlier, Care Ratings had  said,    "Exports lose their shine as the competitive edge is lost. The rupee has already been one of the best

performing currencies with the dollar holding on against the euro. In these conditions further appreciation will come in the way of growth inperforming currencies with the dollar holding on against the euro. In these conditions further appreciation will come in the way of growth in

exports."exports."

Not only this, as per Care, India's remittances will also be negatively impacted as they will deliver lower value when converted to rupeesNot only this, as per Care, India's remittances will also be negatively impacted as they will deliver lower value when converted to rupees

Meanwhile Tarun Lakhotia Akshay Bhor analysts at Kotak Institutional Equities said that strengthening of Indian rupee is largely a negative forMeanwhile Tarun Lakhotia Akshay Bhor analysts at Kotak Institutional Equities said that strengthening of Indian rupee is largely a negative for

energy sector. energy sector. 

The duo at Kotak said, "If INR appreciates further these companies will be impacted by lower oil and gas realizations for upstream,  lowerThe duo at Kotak said, "If INR appreciates further these companies will be impacted by lower oil and gas realizations for upstream,  lower

re ning contribution for downstream,  lower pro tability across core business segments and lower contribution from LPG and petchemre ning contribution for downstream,  lower pro tability across core business segments and lower contribution from LPG and petchem

production segment."production segment."

"Downstream PSUs and "Downstream PSUs and Reliance IndustriesReliance Industries (/topics/reliance-industries) (/topics/reliance-industries) will bene t from one-time gain on a portion of foreign currency will bene t from one-time gain on a portion of foreign currency

liabilities," added Kotak. liabilities," added Kotak. 

On the other hand, a stronger rupee will be a positive factors for wholesale in ation. Care said, "A stronger rupee will result in lower crude oilOn the other hand, a stronger rupee will be a positive factors for wholesale in ation. Care said, "A stronger rupee will result in lower crude oil

prices for the Indian economy. This in turn is expected to reduce the Wholesale price in ation and will bene t aviation sector (importer ofprices for the Indian economy. This in turn is expected to reduce the Wholesale price in ation and will bene t aviation sector (importer of

crude oil) besides other related products."crude oil) besides other related products."

Siddharth Purohit Senior Equity Research Analysts – Banking of Angel Broking said, “We believe a strong rupee should result in lower crudeSiddharth Purohit Senior Equity Research Analysts – Banking of Angel Broking said, “We believe a strong rupee should result in lower crude

oil prices for Indian basket and that should keep both CPI and WPI under check in the near term.”oil prices for Indian basket and that should keep both CPI and WPI under check in the near term.”

For now, companies who are having foreign denominated debt will bene t from a stronger Rupee. For now, companies who are having foreign denominated debt will bene t from a stronger Rupee. 

In order to determine rupee, RBI will have to intervene in the foreign exchange market by purchasing more dollars. In order to determine rupee, RBI will have to intervene in the foreign exchange market by purchasing more dollars. 

Care said, " The decision will be based on the judgment on what has caused the rupee to move up so fast. If it were just the fundamentals,Care said, " The decision will be based on the judgment on what has caused the rupee to move up so fast. If it were just the fundamentals,

then the probability of intervention will be minimal. However, if it is driven by speculative forces which have made the market volatile, therethen the probability of intervention will be minimal. However, if it is driven by speculative forces which have made the market volatile, there

would be proactive measures invoked by the central bank."would be proactive measures invoked by the central bank."

"This however will result in injecting "This however will result in injecting liquidityliquidity (/topics/liquidity) (/topics/liquidity) at a time when the markets are already facing the situation of excess at a time when the markets are already facing the situation of excess

liquidity.  Therefore, RBI may have to use compensating tools such as Open markets operations, MSS bonds, cash management bills andliquidity.  Therefore, RBI may have to use compensating tools such as Open markets operations, MSS bonds, cash management bills and

variable variable reverse repo ratereverse repo rate (/topics/reverse-repo-rate) (/topics/reverse-repo-rate) to absorb the excess liquidity. This will have to be done to stabilize bond yields, " Care to absorb the excess liquidity. This will have to be done to stabilize bond yields, " Care

said. said. 

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Page 3: Rupee continues to rise, many hope its only for a short … continues to rise, many hope its only for a short term Overall, Indian Rupee has appreciated 5.4% in the current Úscal

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Page 5: Rupee continues to rise, many hope its only for a short … continues to rise, many hope its only for a short term Overall, Indian Rupee has appreciated 5.4% in the current Úscal

5/2/2017 Rupee continues to rise, many hope its only for a short term | Zee Business

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