real-time news and commentary for investors
Friday, Aug 16
RBI attempts to boost rupee backfiring
- Measures by the Reserve Bank of India to try to boost the rupee seem to be backfiring - for now - with the currency hitting a record low of 62.13 to the dollar earlier today. The USD-INR is now +0.7% at 61.87.
- Meanwhile, shares are -3.4% on fears the RBI is losing credibility.
- Earlier this week, the RBI said it would cap forex outflows for local firms and residents, steps that economist Radhika Rao says could be perceived as "tantamount to quasi-capital controls." Foreign investors could "rethink plans to invest on fear of controls."
- Not helping the rupee's cause is the fevered expectation that the Fed will soon start tapering, a prospect that is helping the dollar to strengthen.
- ETFs - Stocks: INDY, EPI, PIN, INP, INDA, INXX, SCIF, SCIN, INDL, SMIN. Currency: ICN, INR