India and Iraq consider local currencies as medium of exchange after rupee decline

[hammer911]

No problem, Hammer... if the IQD was on par with the INR, it would be worth US$0.0151939, or 1 1/2 cents.

 

My "confusion" with this scenario is there has not been "during the recent period improved exchange rate dinar and significantly against the dollar," unless I'm missing something with the word "significantly."  So it's puzzling to suppose tying the IQD to the INR, which is worth only 1.5 cents on the dollar, will improve the value of the dinar.  That is, unless we are not privy to all the facts in this matter...

 

GO RV!!!!!!!!!!!!!!

Thanks Maja.... 1 1/2 cents is a big jump from now.. Not a lot of money but a giant leap!!! Thanks man!!!

[yota691]

 

Rupee breaches Rs68 as slide picks up speed

By James Crabtree and Avantika Chilkoti in Mumbai

India’s battered rupee was on track for its worst one-day fall in more than two decades on Wednesday, plunging 3.4 per cent in morning trading to breach Rs68 to the US dollar for the first time in a downbeat reaction to a government plan to rescue the floundering economy.

Palaniappan Chidambaram, finance minister, on Tuesday outlined a 10-point scheme to reduce the nation’s current account deficit and restore economic growth, responding to another day of sharp stock market losses and currency decline.

Shares in Indian banks, which have suffered since the Reserve Bank of India introduced measures to support the rupee last month, continued to be especially badly hit, with the BSE’s Bankex bank index falling by around 5 per cent to its lowest since early 2011.But the rupee nonetheless fell to a new all-time low of Rs68.52 to the dollar on Wednesday morning, taking the fall this month to around 20 per cent and underlining the rupee’s position as one of the world’sworst performing currencies this year.

Stocks were also hit heavily, with the benchmark Bombay Stock Exchange Sensex Index falling as much as 2.5 per cent in morning trading, continuing a downward path that has seen it lose more than 5 per cent this week.

The initial sell-off hit nearly every sector of India’s economy, with the sole exception of the country’s IT outsourcers, raising worries about a wider capital withdrawal by foreign institutional investors.

However the stock market gradually made up its morning losses and the Sensex was flat by mid-afternoon in Mumbai.

Many fear that an early withdrawal of monetary easing by the US Federal Reserve will fuel the flow of yield-seeking funds away from emerging markets.

The sharp declines also come against a backdrop of concerns about rising oil prices given the prospect of possible western military action in Syria, a trend that is likely to hit India’s oil imports-dependent economy especially severely, potentially worsening the country’s current account.

Speaking to parliament on Tuesday, Mr Chidambaram pledged to introduce a range of measures to curb the current account deficit, partly by attempting to end a series of legal restrictions limiting iron ore exports and reducing India’s dependence on expensive imported coal.

“What we need now is not less reforms but more reforms; not more restrictions but less restrictions; not a close economy but a more open economy,” he said.

Mr Chidambaram’s 10-point plan included a pledge to maintain the government’s fiscal deficit at no more than 4.8 per cent of gross domestic product this financial year, while also re-emphasising existing government policies designed to encourage exports and manufacturing industries.

He also promised to accelerate existing government moves to reinvigorate industrial investment by restarting stalled infrastructure projects and pushing some of India’s state-back enterprises to increase capital expenditure programmes.

Mr Chidambaram also outlined a range of measures that could attract foreign capital to the country, including bonds targeted at investment from India’s sizeable diaspora, and refused to rule out the option of India issuing a sovereign bond.

 

 

 

However, investor scepticism over the ability of India’s government to reassure investors that it will be able to respond to rising external pressures continued to provide the most direct reason for Wednesday’s new falls, analysts said.

“You can always look at outside influences like Syria or the Fed, but in our case it is the internal ones that dominate,” said Surjit Bhalla, chairman of Oxus Investments, a financial advisory company based in New Delhi.

“Clearly the ineptitude, brazen populism and lack of appropriate policies from the government is the largest part of the problem . . . you really get a feeling that no one is in control, and the markets are responding to that.”

Investor concerns were exacerbated on Monday when the government passed the country’s Food Security Bill, which will provide inexpensive food but whose estimated costs of $21bn have raised concerns about a worsening of the country’s fiscal deficit.

 

[PD46]

A lot of people are really negative about this article. 

The US has staggering trade deficits and a national debt that is figured at 150% of GDP.  The US is broke and we are literally bankrupt.  We are just waiting on the trillions of $ to come floating back to the US as more countries stop trading in US dollars. 

If Iraq is announcing a trade deal with IQD being traded to another country, then that should tell everyone that currency will be worth more than what it is now.  If the value remains even at 1000 to 1 (which it currently is not), then it's still not even close to the Ruppee.   What is India going to do with a program-rated currency that has no real value and no other country in the world wants at this time? 

The IQD value will need to go up to make the deal attractive to India.  Besides that, India is one of the BRICS nations; and the BRICS nations are working very hard to under-cut the Western Nation's central banking system and develop their own international banking system.  This will mean an end to the petro dollar and our wild-orgy of printing and spending money without having to account for it.  The Fed Reserve tells us they have 9 trillion $ in circulation both domestic and around the world.  As more of those $ start coming back to the US and are no longer wanted, the US will slowly start looking more and more like Zimbabwe are steroids.  The Great Depression will have to be renamed to something of a lesser name. 

I don't believe the US no longer has the gold to even put the US back on the gold standard.  If they did and was phased in over a 12 month period, we might be able to survive. 

Anyway, this article is a mixed blessing, because mostly likely the US is being phased out of trading between Iraq and India and the US will continue to depreciate.  It will take more of those little $ to buy things, and any profit we make from the IQD, will simply be eat up by the devaluation of the US $. 

US Imperialism, trying to control the world and pay financial aid out to countries so they will like us, is coming to an end.  It is sad really that we elected corrupt, criminal politicians and let our arrogance get in the way of US becoming an great republic that withstood the test of time. 

Good article though.  It just confirms that the IQD will have to up their value and be internationally recognized. 

[easyrider]

I honestly believe Iraq has been using two sets of books one book has the new rate while the other still shows the program rate.  I just cant fathom Iraq striking all these deals and especially swapping local currencies with the Indian rupee at 1166.  How will that help the rupee? when the programmed rate is still intact doesnt add up to me.  I would strongly suggest all of you check out the movie Olympus has fallen because thats exactly whats coming imho.

This is very bad!  They are talking about eliminating the petro dollar to purchase oil among other things.....this is not good.  If countries start using other currency besides the dollar - our dollar will plummett!  And this was the last straw that got the U.S. to go after Saddaam.  It wasnt WOMD, it was threatening the petro dollar.  This is IMO.

its bad of course but its been a long time coming be prepare is all im saying. We truly went to what because saddam wanted euros instead of dollars.  Gaddafi from Lybia threatened to produce gold dinars and wanted  all the ME to follow suit!! The U.s couldnt have that  so they invaded same thing with Syria, this is why we are AGAIN on the brink of yet another war!! this will ruin our economy even more Olympus has FALLEN!!!

Edited August 28, 2013 by easyrider

[yota691]

The largest decline of the Indian rupee in 18 years

Indian currency

Wednesday, August 28, 2013 - 17:32 GMT Abu Dhabi 

Abu Dhabi - Sky News Arabia

Indian rupee fell to a record low near 69 rupees to the dollar on Wednesday, with growing fears of a continuing exodus of investors from the country facing economic challenges as well as fluctuations in global markets.

And payment of falling markets rupee to decline 3.7% registered their lowest ever at 68.85 rupees to the dollar and currency finished top of it a little bit at 68.80-60.81 rupees in the biggest drop for a single day since October 1995. The rupee closed at 66.24-66.25 rupees to the dollar on Tuesday. seems to be Falling rupee to the psychological level is important at 70 rupees to the dollar has become imminent after granting central bank intervened in the morning currency Indian short notice breathtaking. chief dealings Asian equities at Pioneer Investments in London, Angelo كوربيتا "unless steps are taken to implement the reforms necessary to confront problems structural, the government will face three options are defaults or devaluation or deflation. " and "I see India is now down in the value of the currency may be deflation imminent. good news is that it is unlikely a failure to repay the debt." and investors sold foreign shares Indian about one billion dollars in eight sessions until Tuesday, which raises expectations disturbing because the stock was a factor attracting strong capital in the first half of 2013. , and if it comes out more foreign investors fear the dealers to pay it India to a vicious circle of declining confidence which in turn leads to severe damage of the shares and currency. works policymakers to take action to convince the markets that they can maintain the stability of the rupiah and attract funds into the country despite the extraordinary measures taken by the central bank last month to absorb liquidity from the market and reduce gold imports and reduce oil import bill bulky.

[k98nights]

 It is sad really that we elected corrupt, criminal politicians and let our arrogance get in the way of US becoming an great republic that withstood the test of time. 

 

 

I'm beginning to suspect America is on a decline that is swiftly becoming irreversable...on many different levels. My children may actually witness the split up of America into smaller independant nations... if you base it on politics the Republican nations will far outlast the liberal Democrat nations. The Dems won't be able to suck the working people dry anymore with their socialism and the Conservative nations will do what they do best...work hard, not complain, and survive...and even thrive eventually. The Confederacy may rise again... Texas may be an independant nation again... who knows.

[yota691]

Oil and Metals Drop as Emerging Stocks to Rupee NDFs Rise

By Emma O’Brien & Yoshiaki Nohara - Aug 28, 2013 8:54 PM ET

•  
  

Crude oil in New York retreated from a two-year high and most metals fell, while emerging-market stocks and currencies rebounded. Indian rupee forwards strengthened the first time this week.

West Texas Intermediate oil fell 0.8 percent to $109.23 a barrel by 9:52 a.m. in Tokyo, dropping from the highest settlement since May 2011, as Brent crude slipped 0.7 percent. Copper slid a third day, while zinc and tin declined. The MSCI Emerging Markets Index snapped a two-day drop to rise 0.2 percent in early trading, as Standard & Poor’s 500 Index (SPX) futures lost 0.1 percent. Malaysia’s ringgit appreciated from a three-year low and one-month rupee forwards gained the first day this week. Australian bonds fell.

 

3:1

 

4:52

Aug. 28 (Bloomberg) -- Jonathan Barratt, the chief executive officer of Barratt’s Bulletin in Sydney, talks about copper, nickel, gold and oil. He speaks with Rishaad Salamat on Bloomberg Television's "On the Move." (Source: Bloomberg)

Concern military action against Syria will disrupt global oil supplies has fueled gains in energy commodities this week and exacerbated losses in emerging markets already hobbled by speculation the U.S. will start reducing stimulus next month.India introduced a currency swap window for oil companiesyesterday as the rupee plunged the most in 20 years, and Indonesia’s central bank will meet today amid a sliding rupiah and slowing growth. A report today may show U.S. gross domestic product grew more than previously estimated last quarter.

“We will see some stabilization today, but there’s still a lot of caution because the problem is not just Syria,” Shane Oliver, Sydney-based head of investment strategy at AMP Capital Investors Ltd., which oversees $131 billion, said by phone. “There’s a combination of fears that the U.S. Federal Reserve will start paring monetary stimulus and at the same time underlying fundamentals in Asian countries are looking less attractive than they have for many years.”

Syria Objectives

The U.S. and the U.K. said yesterday that they are prepared to take military action against Syria without authorization from the United Nations Security Council after Russia objected to a resolution granting action to protect civilians. President Barack Obama and allied leaders are working to define the objectives of a strike in response to an alleged chemical weapons attack by the regime near Damascus last week, according to a U.S. official who asked not to be identified discussing war-planning efforts.

WTI crude for October delivery touched the highest price since May 2011 yesterday and Brent oil climbed 2 percent. Gasoline futures also retreated today, with contracts due next month declining 0.4 percent after increasing over the past two days. Natural gas futures rose a fourth day, adding 0.4 percent.

Australian Shares

The MSCI Asia Pacific Index was little changed after falling to a two-month low yesterday. More than 230 stocks declined while 228 rose. Australia’s S&P/ASX 200 Index slipped 0.3 percent and Japan’s Topix gauge lost 0.2 percent. South Korea’s Kospi Index advanced 0.8 percent, led by power producers and machinery companies.

The Bloomberg China-US Equity Index of the most-traded Chinese stocks in New York climbed 0.5 percent yesterday, snapping a two-day decline.

One-month non-deliverable forwards on the rupee strengthened 1.6 percent to 67.95 per dollar today. The currency sank 4 percent yesterday, the most since 1993, on speculation higher oil prices will worsen the nation’s current-account deficit and hobble the economy.

The ringgit halted a three-day drop to gain 0.4 percent to 3.3212 per dollar, while the Korean wonadded 0.2 percent to 1,112.63 against the greenback. The Thai baht strengthened 0.3 percent to 32.17 a dollar, climbing for the first time this week.

Bank Indonesia

Bank Indonesia holds an additional meeting of its board of governors today where it will look at various policies including interest rates, Deputy Governor Perry Warjiyo said yesterday. The rupiah retreated a third day yesterday, weakening 0.2 percent to 10,945 per dollar, the lowest close since April 2009.

The yen lost 0.2 percent to 97.79 per dollar after data showed Japanese retail sales fell 1.8 percent percent in July, more than economists expected. New Zealand’s currency climbed 0.4 percent to 78.26 U.S. cents before the release of ANZ Bank New Zealand Ltd.’s business confidence index for August. Positive sentiment was the highest since April 1999 last month.

Yields on 10-year Australian government bonds rose for the first time in five days, adding two basis points, or 0.02 percentage point, to 3.93 percent. Ten-year Treasury yields rose one basis point to 2.78 percent, after gaining six basis points yesterday.

Tapering ‘Mood’

A report today will probably show U.S. gross domestic product expanded 2.2 percent in the second quarter, following the government’s earlier estimate of 1.7 percent, according to a Bloomberg survey of economists. Global funds have withdrawn about $44 billion from emerging-market stock and bond funds since the end of May through last week, according to EPFR Global, on the outlook for Fed stimulus cuts.

The GDP data will help “gauge the mood for tapering,” Evan Lucas, a market strategist at IG Ltd. in Melbourne, said by phone. “A positive read would suggest tapering is coming but a bad number will hold it off.”

Copper for three-month delivery on the London Metal Exchange dropped 0.5 percent, while zinc slid 0.4 percent and tin lost 0.2 percent in early trading. Gold snapped a five-day rally to decline 0.5 percent, silver sank 0.6 percent and platinum and palladium lost 0.4 percent. Nickel rose 0.1 percent.

Edited August 29, 2013 by yota691

[yota691]

RPT-Fitch: Currency Slide Will Add to Indian Banks' Woes

(Repeat for additional subscribers)Thu Aug 29, 2013 7:19am EDT

Aug 29 (Reuters) - (The following statement was released by the rating agency)

The sharp depreciation of the Indian rupee will add to credit pressures on Indian banks, says Fitch Ratings. The current economic slowdown is also likely to be deeper and longer than our baseline expectations, adding to the pressures already faced by the local banking sector.

The 21% depreciation of the rupee since 1 April is likely to pressurize the financial performance of the Indian corporations with unhedged foreign-currency borrowing. As a result, Indian banks' asset quality could remain under prolonged pressure. Moreover, the sharp weakening of the rupee, if not swiftly reversed, will delay any chances of recovery in domestic demand.

Recent monetary measures to support the currency have raised the likelihood of a further slowdown within the fiscal year ending March 2014 (FY14). These policy measures, which have sharply raised short-term rates, follow a sub-5% year-on-year GDP growth rate over the past few quarters. These developments belie our earlier expectation of a modest pick-up in India's economic growth. They will also subdue any improvement in the growth rate of loan books.

One likely result is that banks' earnings profiles will encounter more pressure than previously anticipated. This is because of weaker margins resulting from higher funding costs, and a lower ability to pass on costs to the customer due to soft demand and slowing loan growth.

Most recent RBI data on stressed assets (NPLs and restructured) for the system was 10% of total loans. But this was before the onset of the most recent fall in the rupee. Fitch's original estimates of stressed assets in the system peaking in FY14 would need to be revised, and is now likely to peak only in FY15. A more prolonged deterioration in asset quality will also raise provisioning requirements and weigh on banks' earnings profiles.

No bank is likely to be unscathed by recent events. But public sectorbanks remain under relatively greater pressure. This is because their (standalone) stress-absorption capacity is comparatively lower than their private-sector peers, adding further downward pressure on their Viability Ratings. However, as most public-sector banks' IDRs factor in support from the sovereign, the outlook at that level remains stable - in line with that of the sovereign.

Overall, heightened credit pressures would add to concerns about capital adequacy for certain parts of the system. That said, recent statements by the authorities which recognize the need to maintain the capital positions of public sector banks should prove supportive.

There are two potential silver linings, however, amid the rising credit pressure. First, the normal monsoons this year could put a floor beneath slowing domestic demand, especially in the agricultural sector. Second, greater recourse to bank borrowing by Indian corporates which face sharply heightened pressure in the local bond market, could also limit the risk of a slowdown in loan demand greater than what might have been feared.

India oil play eases currency pain

By Charles Riley  @CRrileyCNN August 29, 2013: 7:27 AM ET

HONG KONG (CNNMoney)

The rupee pulled back from a record low Thursday after India announced a plan to lend dollars to state oil companies, the latest in a series of measures designed to stem the currency's decline.

The central bank said late Wednesday that it would lend U.S. dollars to three state-controlled oil refiners -- Bharat Petroleum, Indian Oil and Hindustan Petroleum.

"On the basis of assessment of current market conditions, Reserve Bank of India has decided to open a forex swap window to meet the entire daily dollar requirements of three public sector oil marketing companies," the bank said.

Opening the lending channel should ease demand for dollars on the open market, helping to support the rupee. India is the world's fourth-largest oil importer, bringing in nearly 3 million barrels a day. Oil companies are often required to fulfill contracts using dollars, and the firms are major players in currency markets.

The news was received favorably by investors, and the rupee strengthened 1.5% in early trading. The benchmark Mumbai Sensex added 2%.

Related story: India's finance minister tries to stem panic

Yet it's not clear if the favorable sentiment will last.

 

India's love for gold hurts economy

 

The rupee has lost 12% of its value in the past month, much of that in a series of stomach-churning drops over the past few days. Equity markets have tracked the rupee lower, and the Sensex has quickly turned into one of the worst performers in Asia.

The government has responded with a series of policy changes, but none have been particularly effective.

"We've seen halfhearted attempts from the central bank to stabilize the currency," Rahul Chadha of Mirae Asset Global Investments told CNN. "At a certain level, the market needs to be convinced that the central bank has enough firepower to stabilize the currency."

The threat of a military strike against Syria by western powers -- and higher oil prices -- remains a wild card. The same is true of any decision by the Federal Reserve to reduce itsquantitative easing program.

Related story: BRIC markets left in the dust

India is vulnerable due to its $88 billion current account deficit, which reflects the nation's tendency to import many more goods than it exports and leaves it heavily reliant on foreign capital.

India's stockpile of foreign currency reserves has fallen to $277 billion from $296 billion at the start of the year, but that is still enough to cover seven months of imports, Prime Minister Manmohan Singh was reported as saying earlier this month.

Economists have long argued that India needs to implement structural economic reforms to bring about meaningful progress. Last year, parliament lifted restrictions on foreign direct investment after much debate -- a key step.

But investment dollars have not materialized as international companies seek more details about the new policy and remain wary of a change in the political winds that could reverse the decision. 

[ChuckFinley]

K98nights and TrinityeXhange, I have to agree with your statements and thought processes.  Within the last six years we have nearly doubled our debt. The US is becoming a non-player. We are not there yet, but we are well on our way and we will see it in our life time. The National debt 17T, 128T unfunded liabilites, fed retirements, SS, etc.  We are bring in less revenue through taxes and we will be unable to cover our interest on these loans (except to print more money). States are taking in less revenue and are working in the red. There has been an increase in towns and cities going bankrupt (Cali, Al, Detroit). In the cases like Baltimore there is a law that states they can not (they are 2B in the hole). The world is viewing us as a risk and are moving assets from the dollar to other currencies. We continue to print money and the government is desperate  to find more ways to get it from us, i.e. FACTA. The BRIC countries made a pack a year or so ago to trade in their own currency. Other countries are starting to do the same. This is bad for USA, but a great move for the IQD. We need to focus outside the US to ensure we have a future. There are many other reasons i could add to the above statement, but we need to move on and focus on the investment and what opportunities that Adam has planned for us.

[yota691]

Indian Prime Minister rule out the imposition of restrictions on the movement of capital

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Posted: Saturday, August 31, 2013

New Delhi (dpa) - ruled out Manmohan Singh, the Indian Prime Minister to impose restrictions on the movement of capital, and expressed his government's concern of the sharp decline of the value of the Indian currency 'rupee'.

Singh said in a statement to the Indian parliament yesterday that the decline in the value of the rupee was the market's reaction to unforeseen external developments, such as reducing the U.S. Federal Reserve Board (ECB) policy of quantitative easing tensions over Syria. He added: «that the sudden drop in the exchange rate is certainly a shock, but we will deal with it through other procedures, and not through restrictions on capital or recidivism for the process of reforms».

The rupee fell partially convertible by about 16% against the dollar since January this year, registering a record low level at Rs 68.85 to the dollar last Wednesday. The Indian currency is recovering since then, the dollar was trading at Rs 66.69 during morning trading on Friday.

 

 

 

 

Since the days, Palaniappan Chidambaram said Indian Finance Minister, said that the rapid growth in the economy five years ago, he set a record of $ 92 billion to foreign exchange reserves in India in one year. He added that the circumstances have changed significantly for the worse, in the time you put in. outlines a ten-point plan to save the economy, but there was a light on the horizon. He told Parliament: «I see a glimmer of hope.

Edited August 30, 2013 by yota691

[yota691]

Rupee gains to 62.99 as foreign banks sell

By Reuters | 17 Sep, 2013, 03.07PM IST

 

 

 

Dollar edged lower on Tuesday, but traded in a tight range before US Federal Reserve meeting which is expected to scale back its monetary stimulus.

The rupee has pared most of the losses for the day as foreign banks sold on behalf of custodial clients, three dealers said. 

The rupee is at 62.99/00 as against Monday's close of 62.83/84 after rising to 63.6450 early today. 

Dealers also cite hopes of good inflows related to banks bringing in dollar deposits from overseas Indians. 

Foreign banks are offering upfront financing for wealthy non-resident Indians (NRIs) of 90 per cent to set up dollar deposits in India following various RBI incentives, including cheap dollar/rupee swap rates and more relaxed terms on 3-5 year dollar deposits, private banking sources said. 

The dollar edged lower on Tuesday, but traded in a tight range before a two-day US Federal Reserve meeting which is expected to result in a scaling back of its monetary stimulus. 

 

Read more: http://dinarvets.com/forums/index.php?/topic/161092-rupee-gains-to-6299-as-foreign-banks-sell/#ixzz2f9FgNdhq

 

[yota691]

In an Unexpected Move, the Indian Central Bank Leaves Rates Unchanged By NEHA THIRANI BAGRI Published: December 18, 2013

MUMBAI, India — India’s central bank surprised economists on Wednesday when it held interest rates steady, citing an expected reduction in food prices and a struggling domestic economy.

In its quarterly review of monetary policy, the Reserve Bank of India decided to leave the benchmark repurchase rate, the short-term lending rate that banks rely on for their underlying financing, at 7.75 percent. Analysts had been widely expecting the central bank to act as it did in its previous two policy meetings and raise the rate, known as the repo rate, by a quarter of a percentage point as inflation continues to plague the Indian economy.

Soaring food prices drove consumer price inflation up to an annual rate of 11.24 percent in November, from 10.17 percent in the previous month. The wholesale price inflation, the benchmark measure of inflation for India, accelerated to a 14-month high in November, to an annual rate of 7.5 percent, up from 7 percent in October. The rise was led by higher prices for food, which increased 13.8 percent, and fuel, which rose 11.1 percent.

The central bank said, however, that the decision to hold rates had been driven by indications that food prices might drop soon and that the effects of previous interest rate increases might not yet be felt.

“Given the wide bands of uncertainty surrounding the short-term path of inflation from its high current levels and given the weak state of the economy, the inadvisability of overly reactive policy action, as well as the long lags with which monetary policy works, there is merit in waiting for more data to reduce uncertainty,” the Reserve Bank of India said in a news release on Wednesday.

Bhupali Gursale, an economist at Angel Broking in Mumbai, said the central bank’s decision did not mean it was backing away from its commitment to fight inflation.

“While the Reserve Bank is not acting right now, based on the fact that food inflation might be cooling down, it has yet maintained a cautious stance,” he said.

The Indian stock market rallied after the central bank’s announcement. The Bombay Stock Exchange Sensex rose 1.1 percent, and the 50-share Nifty went up 1.2 percent. The rupee was trading at 61.82 per dollar, against its close on Tuesday of 62.01.

And industrial leaders welcomed the central bank’s decision in light of weak domestic growth.

“The Reserve Bank of India has demonstrated restraint and foresight to strike the right balance between inflation and growth,” said Chandrajit Banerjee, director general at the Confederation of Indian Industry. “The current spike in inflation is a supply-side phenomenon, and therefore a tight monetary policy would hurt growth while proving unequal to the task of tackling inflation.”

The sharp spike in prices is a mounting worry for the governing Indian National Congress as it prepares for national elections in 2014. The rising cost of food — onions in particular — is a contentious political issue.

Last week, P. Chidambaram, the finance minister, said higher food costs were a reason that the Congress party was defeated in the Delhi state assembly elections this month.

“It is common knowledge that the government of the day will pay a price for high inflation, especially if inflation persists over a long period of time,” Mr. Chidambaram said.

Raghuram Rajan, India’s central bank governor, has struggled to battle both relentless inflation and weak economic growth since he took charge in September. India’s economy expanded at an annual rate of 4.8 percent in the quarter that ended in September, raising hopes of gradual improvement. India’s economic recovery remains fragile, however, as seen in the October industrial production figures, which fell 1.8 percent compared with a year earlier after expanding 2 percent in the previous month.

“In a situation where you have high inflation and low growth, you have to calibrate policy carefully,” Mr. Rajan said after the retail and factory output figures were released Dec. 12. “I’ve said there are some trade-offs that we have to make.”

Analysts said the inflation data for November might not be an accurate gauge of wider inflation risks, causing the central bank to wait until it had a clearer understanding.

“There is a lot of uncertainty regarding the inflation and growth data in the markets, and the Reserve Bank is concerned that the current high inflation numbers might be a one-off, not reflective of larger inflationary trends,” said Saugata Bhattacharya, chief economist at Axis Bank in Mumbai. “Given the economic and financial fragility in the environment, a hasty move on monetary policy might have very serious repercussions on growth.”

Since he has taken the helm at the central bank, Mr. Rajan has made it clear that cooling prices is his priority. The Reserve Bank of India raised interest rates a quarter percentage point at each of the two monetary policy meetings before Wednesday. Responding to fears that the central bank might be softening its stance on inflation, the bank clarified that it would continue to maintain a vigilant stance and would be willing to act between scheduled meetings if inflation did not stabilize.

[yota691]

add this...Daily average rose 19% in December Trading DGCX and commodities jump 25%

Source: 

• Dubai statement

History:  January 19, 2015

 

•  

Trading volumes have seen in DGCX goods growth during the month of December last year by 25% compared to the same period of the previous year, registering a trading 962.438 contract worth 27.84 billion dollars.

Daily turnover rate grew by 19% on an annual basis for up to 45 830 contracts in December 2014 and rose gold trading in the stock market for up to 41 945 contracts in December 2014, registered a remarkable growth rate of 14% compared to the same period last year.

Currency

Currency and formed the main engine of growth in trading volumes on an annual basis, where the number of currencies traded in December last decades amounted to 897.116 contract growth rate of 25% compared to December 2013.

And recorded the Indian rupee futures third highest rate of interest open daily during the month of December, a growth of 21% compared to the same period of the previous year, while the Indian rupee mini futures contracts grew by 69%.

And precious metals rose in Borse Dubai Gold and Commodities trading by 16% on an annual basis, while its trading in Alhdrokrboneat sector grew by 45%, and sector growth stock by 95%.

Diversification

2014 saw further diversification in the portfolio of products Borse Dubai Gold and Commodities, with the launch of several new contracts. The ASE launched early last year, the first plastic held in the region.

In addition to expanding its portfolio of emerging market products, re-stock the inclusion of Indian Rupee contract options, and launched two index MSCI India, and included a couple of new Indian rupee mini contracts. Ended DGCX goods 2014 high pace, with the launch of three new currency contracts are the Russian ruble, the Korean won and the South African rand.

He Jawarang Desai, CEO provisional Dubai Gold and Commodities: «in 2014, Borse Dubai Gold and Commodities have seen a strong push to expand its products based on currencies and indicators of emerging markets, and providing unique products such as plastics futures contracts.

The ASE has also upgraded its technology to provide its members with more functions and enhance their efficiency. This technological upgrade of the Stock Exchange also allowed to carry out trading, clearing and settlement in different currencies, including the UAE dirham ».

Desai added: «Our aim in 2015, to increase the number of our members, put more innovative contracts, ranging from instant gold which will be launched in the early decades of this year. In addition, we also look forward to the inclusion of more contracts related to currencies, stocks and soft goods products. »

Members

2014 saw significant growth in the number of members of the Borse Dubai Gold and Commodities accession of several new members of the United Arab Emirates, Asia and Europe.

 Borse Dubai also signed Gold and Commodities memorandum of understanding with China's Stock Futures (CFFEX) in order to forge closer ties and processes in the areas of risk management, and business strategies, and monitor the state of the market, and new product development.

Furthermore, continued Borse Dubai Gold and Commodities acquisition of global recognition because of the growth witnessed and innovation in its products in 2014, where he won the title «General Stock Exchange in 2014» in the Middle East and Australia for the second consecutive year, and that by the magazine «FOW» world leader in the area of ​​financial derivatives.

 

Highlighted the achievements of the stock market in 2014

 

 

Launch plastic futures contracts, the first of its kind in the region in the February 28, 2014

At June 16, the bourse completed upgrade technological platform for trading, the upgrade has included a number of improvements related to the circulation of multiple currencies, and the inclusion of options contracts, with the strengthening of trading, clearing and global interdependence flexibility.

Re-insert the Indian Rupee contract options on July 18

Recording the highest rate center is open daily during the month of July 2014 with a circulation of 54 718 contract

Move to new offices in the Jumeirah Lakes Towers (JL T) in August

Borse Dubai Gold and Commodities launches a couple of new Indian rupee mini futures contracts in the October 26

Borse Dubai Gold and Commodities launches two time-limits for index Morgan Stanley MSCI India in October 17

In December 2, 2014, the Dubai Mercantile Exchange launched the Gold and Commodities settlement services and fixed deposits in UAE Dirhams through Dubai for clearing goods (DCCC).

On December 8, Borse Dubai Gold and Commodities signed a memorandum of understanding with China's Stock Futures (CFFEX)

At December 26, DGCX launched three new goods and futures contracts for emerging-market currencies, are: the Russian ruble and the Korean won and the South African rand

Annual market share of the Dubai Gold and Commodities of the Indian rupee futures in 2014 rose 5.22%, to jump from 29.13% in 2013 to 34.35% in 2014.

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