Expert Zone
Straight from the Specialists
When will the rupee recover?
(The views expressed in this column are the author’s own and do not represent those of Reuters)
The rupee sank to its lowest on Tuesday with pressures from the market and absence of support from the RBI. The fall really began in August and in the last four months took the rupee down 18 percent against the dollar.
What has gone so seriously wrong with the rupee?
Many other currencies also weakened but the rupee underperformed the most because a significant demand supply gap for dollars had developed. There are two important causes for this sharp fall in such a short time. First, the usual inflow of dollars from investment by FIIs had stopped and even significantly reversed.
In the four months since August, disinvestment was more than $2 billion which pushed prices of stocks down and raised the price of dollars up. The fall of the stock market and of the rupee go together because they are two sides of the same transaction.
Insurance industry players go online — reluctantly
(The views expressed in this column are the author’s own and do not represent those of Reuters)
From the year 2000 onwards, the Indian insurance industry saw a number of private players entering through the gates thrown open by the government. Public sector player LIC had already gained an edge by being a pioneer in the life insurance space. With an army of agents, LIC was way ahead of these latecomers and found itself settled comfortably.
India Market Weekahead: Re-test of earlier lows expected
(The views expressed in this column are the author’s own and do not represent those of Reuters)
Initial optimism over the resignation of Italian Prime Minister Berlusconi faded quickly and there was further intensification of euro zone fear during the week. The Indian markets underperformed immensely vis-à-vis its global peers with a deep cut of 5 pct during the week. The sharp pangs of distressing high inflation, weaker rupee, disappointing corporate results and FII selling pushed the markets back to its earlier range of 4700 – 5200.
First impressions and beyond
(The views expressed in this column are the author’s own and do not represent those of Reuters)
If you walk down a quite narrow and almost absurdly overcrowded street in Mumbai’s former financial district, Fort, you’ll come across an undistinguished building about 100 years old. It’s called Bombay House. This is the home of Tata.
India markets weekahead: Moody’s rating, inflation to set the tone
(The views expressed in this column are the author’s own and do not represent those of Reuters)
The week that went by was quite a turbulent one as domestic and international factors dampened market sentiments, resulting in a 2.1 pct decline in Nifty in what was a truncated trading week. We were saved from a possible savage cut on Thursday as it was a market holiday.
The burden of subsidies
(The views expressed in this column are the author’s own and do not represent those of Reuters)
At the Indian media meet at Cannes, the economist in Prime Minister Manmohan Singh came out spontaneously when he said the prices of petroleum products should find their ‘market level’. For a time at least he ignored political compulsions.
India markets weekahead: Bumpy road ahead, but time to top up your portfolio
(The views expressed in this column are the author’s own and do not represent those of Reuters)
The near 8 percent October rally threatened to fizzle out as the Greece drama drove trade for virtually the whole of last week, keeping markets volatile. The initial exhilaration surrounding the euro zone bailout plan faded after the Greek prime minister called for a referendum.
Another case of insurance regulation – good or bad?
(The views expressed in this column are the author’s own and do not represent those of Reuters)
Motor insurance is the only insurance product in India mandated by law. This means that any one owning a vehicle is bound under the Motor Vehicles Act, 1988 to have a third-party motor insurance policy.
The end of repo rate hike?
(The views expressed in this column are the author’s own and do not represent those of Reuters)
Apparently, the RBI is exasperated. After 18 months of inflation and 13 hikes in repo rate, RBI Governor Duvvuri Subbarao more or less admitted a day before Diwali that the pursuit of interest policy had gone far enough even though it hardly made any different to inflation and only deflated the growth rate instead. But he is not without hope.
India markets weekahead: New range for markets but scepticism abounds
(The views expressed in this column are the author’s own and do not represent those of Reuters)
Markets finally came out of the range last week with the Nifty breaking the 5200/5250 resistance after a positive outcome to the long-awaited plan to resolve the European debt crisis. The plans included a ‘haircut’ of 50 pct on Greek debt, an increase to the size of the European Financial Stability Facility (EFSF), and a 9 pct core capital threshold for European banks.
