Indian Rupee Gains Against Previous Week close

Indian Rupee Gains Against Previous Week close

22 Mar 2019 08:53 PM

 Weekly Synopsis

Date:- 22nd March 2019 

Markets from 18th March 2019 to 22nd March 2019 

Indian Rupee

The Indian rupee erased all its gains and trading lower by 27 paise at 69.09 per dollar versus 68.82 Wednesday. The rupee settled at 68.95 to a dollar, against 68.82 its previous close. It opened at 68.64. India has been one of the fastest growing large economies in the world, the International Monetary Fund  has said, asserting that the country has carried out several key reforms in the last five years, but more needs to be done. The pair USDINR trades in a weekly range between 69.17 to 68.3450.

India's foreign exchange reserves rose to $405.64 billion as of March 15 from $402.04 billion a week earlier, the Reserve Bank of India said on Friday. Changes in foreign currency assets, expressed in dollar terms, include the effect of appreciation or depreciation of other currencies held in its reserves.Foreign exchange reserves include India's Reserve Tranche position in the International Monetary Fund.

Hundreds of Indian traders burned Chinese goods on Tuesday and urged the government to raise import taxes on them to protest against China's trade and foreign policies. The traders, who also urged consumers to boycott Chinese imports, are concerned that Chinese products are hurting Indian manufacturers.

Foreign investors were net buyers of $196.19 million of Indian shares on Mar. 20, according to data from the National Securities Depository Ltd. These investors purchased shares worth $3.82 billion in March so far. Overseas investors have been net buyers of shares worth $5.89 billion so far in 2019. These investors were net sellers of $4.77 billion in 2018 against net purchases of $7.86 billion in 2017. 

Global Market

The U.S. dollar fell on Friday in Asia as traders digested the latest news on Brexit and Sino-U.S. trade development. The U.S. dollar index that tracks the greenback against a basket of other currencies was down 0.2% to 95.803 U.S. Trade Representative Robert Lighthizer, Treasury Secretary Steven Mnuchin and Chinese Vice Premier Liu He are due to meet in Beijing for a fresh round of talks next week.

The number of Americans filing applications for unemployment benefits fell more than expected last week, pointing to still strong labor market conditions, though the pace of job growth has slowed after last year's robust gains.

The number of people who filed new applications for unemployment assistance in the U.S. last week fell by more than expected, indicating that conditions in the labor market remain aren't weakening markedly despite a sharp drop in new jobs in February. The U.S. Department of Labor said Thursday that initial jobless claims in the week ended March 16 decreased by 9,000 to a seasonally-adjusted 221,000.

The German economy looked set for a stagnation in the first quarter as private sector activity fell to a six-year low in March. IHS Markit said that its flash reading its German composite output index, which measures the combined output of both the manufacturing and service sectors, fell to 51.5 from 52.8 in the prior month.

German economic growth remained subdued in the first quarter, dragged down by weak industrial production, falling export demand for cars and deteriorating manufacturing sentiment. Struggling with unexpected weakness in among its car manufacturers, Germany barely escaped a recession last quarter. Fresh indicators suggest any recovery will be slow, at best, a drag on growth across the entire euro zone.

The European Union's trade surplus with the United States and its deficit with China both increased in January, serving as potential fuel for trade conflicts between the world's largest economies. The EU surplus in goods trade with the United States expanded to 11.5 billion euros in January, from 10.1 billion in January 2018, EU statistics office. 

The British labor market remained tight at the start of 2019, with the jobless rate hitting its lowest level in 44 years and wage inflation rising at the fastest pace since the financial crisis, despite concerns over the U.K.’s imminent exit from the European Union. The jobless rate unexpectedly fell to 3.9% in the three months to January, its lowest level since January 1975, while the number of people in work rose 222,000, its largest increase since 2015.

Germany’s economic mood improved to a one-year high in March, but concerns over the health of the euro zone's largest economy lingered after the government's council of economic advisors slashed their growth forecast for this year. The index of German economic sentiment rose to -3.6 points this month from a reading of -13.4 in February.

Britain's main inflation rate ticked up last month but stayed close to January's two-year low, helping consumers maintain their spending power even as Brexit remained uncertain. Consumer prices rose at an annual rate of 1.9 percent in February after a 1.8 percent increase in January.

The Bank of England left its key interest rate unchanged as expected, as its policy-making committee voted unanimously against changing monetary policy as the U.K. grapples with how and when it will leave the European Union. U.K. data continue to show signs of strength, the Bank remains reluctant to raise interest rates while the risk of a disorderly Brexit remains.

British retailers racked up surprisingly strong sales last month, reinforcing how spending by consumers is a bright spot for the economy ahead of Brexit. Retail sales grew by an annual 4.0 percent in February, the top end of a range of forecasts by economists.

U.K. consumers shrugged off uncertainty over Brexit in February, driving retail sales higher by a stronger-than-expected 0.4%. Retail sales were up 4% from a year earlier, the Office for National Statistics said on Thursday, also ahead of expectations for a rise of 3.3%.

British private-sector employers expect to give staff a basic annual pay rise of 2.5 percent this year, the same as in 2018, though some will delay awards until after government Brexit plans are clearer, an industry survey showed on Thursday.

The Federal Reserve left interest rates unchanged on Wednesday and said it would stop its balance-sheet reduction program in September amid concerns over slowing growth both domestically and abroad. The Federal Open Market Committee left its overnight funds rate in a range of 2.25% to 2.5%.

U.S. mortgage applications for buying or refinancing a home climbed to a two-month high last week, as home borrowing costs fell to their lowest in over a year, data from the Mortgage Bankers Association showed on Wednesday. The Washington-based industry group's seasonally adjusted index on mortgage activity edged up 1.6 percent to 390.0 in the week ended March 15.

Local Market 

Benchmark indices ended lower but off day's low on Friday with Nifty finished below 11,500 level. At close, the Sensex was down 222.14 points at 38164.61, while Nifty was down 64.10 points at 11456.90. About 1009 shares have advanced, 1665 shares declined, and 143 shares are unchanged.

Crude oil prices dipped by Rs 7 to Rs 4,139 per barrel in futures trade on Friday as speculators were indulged in creating speculative positions, taking positive cues from domestic markets. At the Multi Commodity Exchange, crude oil for delivery in April was trading lower by Rs 7, or 0.17 per cent, to Rs 4,139 per barrel, in a business turnover of 16,293 lots.

Gold prices rose by Rs 91 to Rs 31,910 per 10 gram in futures trade Friday as speculators widened their bets, tracking a firm trend overseas. At the Multi Commodity Exchange, gold for delivery in April was trading higher by Rs 91, or 0.29 per cent, to Rs 31,910 per 10 gram in a business turnover of 7,881 lots.