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India Market Weekahead: Record lows for rupee, oil key for bonds

RUPEE-RBI-DOLLAR:India Market Weekahead: Record lows for rupee, oil key for bonds

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Reuters

 

Reuters Market Eye - Rupee would see new lows if global risk aversion continues. The Indian unit hit an all-time low of 57.32 versus the dollar on Friday, its second successive session of losses.

Any RBI intervention would be key; as would any potential measures after news the central bank had discussed with state-run oil firms about steering 50 percent of their dollar purchases via a single state-run bank to smoothen volatility in rupee.

Finance Minister Pranab Mukherjee is set to step down on June 26 at a time when slowing policy reforms has been cited as a key reason for the rupee's drop.

 

Bond markets will closely track any movement in global crude oil prices: a further fall may help cool yields more by easing concerns about inflationary pressures.

RBI is scheduled to sell 150 billion rupees of debt next week and traders will await any open market operation by the central bank to help ease liquidity.

(subhadip.sircar@thomsonreuters.com)

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First Published: Jun 22 2012 | 4:31 PM IST

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