Mar 16, 2008

Economy News 16th March 2008

Rupee at 40.43 against US dollar

Mumbai: The Indian rupee on March 14 ended almost flat at 40.4350/4450 against the greenback on alternate bouts of buying and selling in the foreign exchange market. At the Interbank Foreign Exchange (Forex) market, the domestic unit opened lower at 40.50/52 a dollar from previous close of 40.43/44. It later fell to a low of 40.58.

Forex dealers said the rupee sentiments were bolstered later in the day after a surge in the stock market. They added that dollar buying by oil refiners to meet their import requirements aided the local unit. Weak Asian stock markets and recovery in dollar against the Yen also partly weighed on rupee sentiments. Meanwhile, the benchmark Sensex posted a gain of 403 points after yesterday's fall of 770 points. Dealers said heavy dollar sales at the higher levels also pushed the rupee upwards and it touched a high of 40.38 a dollar before concluding the day at Rs 40.4350/4450 a dollar.

         

Inflation rate soars to nine-month high

New Delhi: The rate of inflation soared to 5.11 per cent for the week ended March 1, the highest in over nine months, mainly owing to a rise in the prices of some food articles, certain manufactured products and aviation turbine fuel. With this, the prospects of a cut in interest rates by the Reserve Bank of India to revitalise the sluggish trend in industrial growth appear bleak.

With the inflation rate based on the wholesale price index (WPI) inching up from 5.02 per cent in the previous week, this is for the second consecutive week that it has remained above the "tolerance level" of five per cent set by the RBI for the current fiscal.

 

FM says majority of debt waiver will be to small and marginal farmers

Finance Minister (FM) P Chidambaram today said in Parliament that small and marginal farmers would be given debt relief of Rs 50,524 crore and Rs 9,790-crore would be for one-time settlement of other farm loans. FM had announced a massive Rs 60000-crore debt waiver package to farmers in Union Budget 2008-09 announced on 29 February 2008.

 

FM says government ready to take any fiscal step to control inflation

Finance Minister (FM) P Chidambaram today said the government is ready to take any fiscal step to control inflation which has risen due to increase in prices of imported commodities. Chidambaram told Lok Sabha that international and national factors have contributed to the rise in inflation to nearly 5% from a low of 3.11%.

He said the government has taken some fiscal steps to control the prices such as cutting import and excise duties, and added there was no taxation on food items.

 

Inflation at multi-month high

Inflation based on the wholesale price index (WPI) rose 5.11% in the 12 months to 1 March 2008, higher than the previous week's rise of 5.02%, government data showed on Friday, 14 March 2008. The rate was the highest since 26 May, 2007.

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