The Indian Wire » Business » Rupees falls down to the lowest for this year

Rupees falls down to the lowest for this year

The Indian rupee slid to a near three-month low on Tuesday amid growing concerns about an alleged major bank fraud at India’s second-largest state-run lender , whilst emerging stocks fell half a percent.

The rupee fell 0.9 percent against the dollar to its weakest since mid-November as investors eyed the potential broader implications from the alleged $1.77 billion Punjab National Bank (PNB) loan fraud.

Investors have also been unsettled by India’s trade deficit hitting its highest in over 4-1/2 years in January.

The benchmark Sensex index fell 1.18% , or 407.40 points, to 34,005.76. So far this year , it has fallen 1%.

So far this year , the rupee has fallen 0.8% , while foreign investors bought $1.48 billion and $2.06 billion in local equity and debt markets , respectively.

Bond yield rose ahead of the key consumer price inflation and Index of industrial production data due on Monday.

According to estimates , Index of industrial production will be at 6.1% in December from 8.4% a month ago while CPI will be at 5.1% from 5.21% last month.

Five-year credit default swaps for State Bank of India rose one basis point (bp) from Monday’s close to 90 bps, according to IHS Market data , a two-month high. India’s 10-year local government bond yield traded near a two-year high.

But India’s bank stocks index rebounded 0.7 percent after slumping to a four-month low on Monday.

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