Rupee Rises Against US Dollar After Government Hikes Import Duty: Key Things To Know
The Indian rupee on Thursday advanced by another 22 paise to 72.38 against the US dollar in early trade in the forex market, reported news agency Press Trust of India (PTI). The Indian currency strengthened today after the government raised import duties on select items to check rupee fall and contain current account deficit (CAD). According to traders, selling of the US dollar by exporters and banks, the greenback's weakness against some currencies overseas, also helped the domestic currency recover. Meanwhile, the Federal Reserve rate hike had little impact on the dollar.
Here are key things to know about Indian rupee today:
1. The government on Wednesday announced hike in customs duty on 19 items, including jet fuel and air conditioners, to curb 'non-essential imports' and check the widening current account deficit resulting from high crude oil prices and the rupee dipping to a historic low. The total value of imports of these items stood at Rs.86,000 crore in 2017-18, the Ministry of Finance said in a statement.
2. According to dealers, a higher opening in the equity market also supported the rupee's sentiment today. At 9:42 am, the S&P BSE Sensex advanced 80.79 points or 0.22 per cent to trade at 36,623.06. The broader NSE's Nifty50 index climbed 23.35 points or 0.21 per cent to trade at 11,077.15.
3. The Reserve Bank of India (RBI) eased mandatory cash requirement rules for banks on Thursday and assured jittery markets it would provide "durable liquidity" amid growing worries of a potential credit crunch in the economy.
4. The Federal Reserve raised interest rates for the third time this year on Wednesday. The statement said the Fed still foresees another rate hike in December, three more next year, and one increase in 2020.
5. On Wednesday, rupee rose marginally against the US dollar. The local currency climbed 9 paise to close at 72.60 against the greenback.
6. Global equities ran out of steam on Thursday and US bond yields fell after the Federal Reserve raised interest rates. Asian shares held firm on Thursday, outperforming sagging Wall Street shares.
7. Globally, oil prices rose on Thursday, lifted by looming US sanctions against major crude exporter Iran. (With agencies inputs)
