Amid Reports Of Economic Slowdown, Rupee Is Staring At The Worst Fall In Six Years
The Rupee is facing its worst fall in a month in six years. There is almost unanimous consensus on India facing an economic slowdown. There has been a pull-back of global funds from Indian equities after the FM in budget 2018 levied a surcharge on super-rich.
The Rupee is facing its worst fall in a month in six years. Rupee showed some recovery in the first seven months of the calendar year 2019, but has now lost all the gains in August itself.
There is almost unanimous consensus on India facing an economic slowdown.
¡°As per a forex strategist at Nomura, even though India is unlikely to have direct repercussions of US-China trade woes, nonetheless it can't remain completely unaffected from it. Also, there has been a pull-back of global funds from Indian equities after the FM in budget 2018 levied a surcharge on super-rich that also brought into net some FPIs registered as trusts,¡± says a report by Goodreturns.com.
Some analysts have warned of more pain in the future.
Why is Rupee facing a rapid reversal
A bitter trade war has complicated the government¡¯s task of reigniting Asia¡¯s third-largest economy.
A recent report by FICCI showed that India¡¯s economy will grow at a median rate of 6% during the first quarter of the current financial year ended 30 June.
The country's economy grew at 8.2% in April-June 2018-19. The growth numbers for the first quarter are expected to be released by the Central Statistics Office next week.
"The recently released unemployment numbers by NSSO reaffirm the grim situation with regard to employment in the country," said FICCI Economic Outlook Survey.
The survey pegged the annual median GDP growth forecast for 2019-20 at 6.9 per cent, with a minimum and maximum estimate of 6.7 per cent and 7.2 per cent, respectively. The median is the middle number in a sorted, ascending or descending list of numbers which can be more descriptive of a data set than the average.
Four key areas have been identified for improvement that could help create more jobs: cost of doing business; regulatory reforms; labour reforms and announcement of sector specific special packages.
To achieve India's potential growth rate, the economists suggested boosting agriculture, strengthening micro, small and medium enterprises (MSMEs), undertaking factor market reforms and enhancing avenues for infrastructure financing, said a report by news agency PTI.
A report by Bloomberg said that foreigners have pulled $3.8 billion from local shares since July, as a tax on the superrich announced in the budget last month combined with the risk-off mood triggered by the trade conflict.
