(INDIA 2014 GDP = 1.72 trillion) India’s Rupee Slides to 13-Month Low 63.45

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India’s Rupee Slides to 13-Month Low After Trade Deficit Widens

India’s rupee slumped to a 13-month low as concern over global growth led to a selloff in emerging-market currencies and after data showed the nation’s trade deficit widened.


2014 GDP = 1.72 trillion

India poised to be a $2 trillion economy in 2014 = Missing the Target. Only 1.72 trillion now. The Indian currency weakened 0.9 percent to 63.4950 a dollar as of 11:09 a.m. in Mumbai, according to prices from local banks compiled by Bloomberg. It touched 63.4975 earlier, the lowest level since November 2013. The yield on local sovereign bonds due July 2024 climbed eight basis points to 7.92 percent, poised for its biggest advance since August, prices from the central bank’s trading system show.

“The nervousness in the currency market spilled over into other Indian asset classes,” said Debendra Kumar Dash, a fixed-income trader at DCB Bank Ltd. in Mumbai. “That’s being reflected in bonds.”

The unexpected contraction in industrial output in October


A slew of negative data points have hit domestic sentiments, analysts say. Trade deficit widened to $16.9 billion in November - an 18 month high. A year ago, trade deficit was under $10 billion. The unexpected contraction in industrial output in October has sparked concerns about economic growth.

 

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[BuddhaPalm]

Currency crisis and economic collapse are imminent!

 

[GR!FF!N]

Here are the reasons for the sharp weakness in the rupee,

1) Risk assets including equites are under pressure amid rising concerns about the global economy. Sliding oil prices and a downbeat China factory survey weighed on Asian shares on Tuesday, while the rouble jumped after Russia sharply increased its benchmark interest rate in a bid to halt a collapse in its currency.

2) The rupee has come under selling pressure tracking steep losses in emerging market currencies. On Monday, the Indonesian rupiah hit a 16-year low amidst a slump in crude prices and worries about US rate hikes expected next year.

3) A slew of negative data points have hit domestic sentiments, analysts say. Trade deficit widened to $16.9 billion in November - an 18 month high. A year ago, trade deficit was under $10 billion. The unexpected contraction in industrial output in October has sparked concerns about economic growth.

4) Foreign funds have sold shares in each of the last five trading sessions until Monday, putting pressure on the rupee, analysts say.

5) Expectations of a rate cut have led to softening of bond yields and put pressure on the currency, analysts say.

Rupee Slumps to 13-Month Low of 63.59/Dollar - NDTVProfit.com

 

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