Manufacturing
Elevated commodity prices to keep pressure on rupee
On Friday, the rupee closed at 75.80 to a greenback. Lately, high commodity prices, as well as outflow of foreign funds from equity markets have weakened the Indian rupee against the US dollar.
The rising prices of crude oil, along with other commodities triggered by the Russia-Ukraine war has kept pressure on the rupee.
RBI expected to prioritise growth during April meet
Notably, the consumer price index (CPI) inflation print has remained at elevated level due to higher-than-expected vegetable prices in February. Moreover, inflation is expected to remain at elevated levels due to higher crude oil price in subsequent months owing to the Russia-Ukraine crisis. "Nevertheless, we still expect the RBI to prioritise growth in its April 2022 monetary policy meet as we believe growth is still a bigger concern currently rather than inflation," said Motilal Oswal Financial Services.
'India's energy transactions with Russia should not be politicised'
This comes after the government run Indian Oil Corporation purchased three million barrels of Russian crude oil last week, which was offered at a steep discount to the prevailing international rates. The US has stated that India would not be violating US sanctions by purchasing discounted Russian oil, however "such a move would be equal to supporting Moscow's aggression in Ukraine".
Germany's GDP growth forecast halved due to Ukraine crisis
The annual inflation rate in Germany is expected to rise to 5.8% in 2022, the highest since the country's reunification more than 30 years ago, according to the institute's "Spring Forecast". The Ukraine crisis "delays the return to pre-Covid-19 levels into the second half of the year" and is "putting a noticeable strain on the German economy and increases the already strong inflationary pressure", Xinhua news agency quoted IfW Kiel.
Ukraine legalises cryptocurrency to fight Russian invasion
Ukraine President Volodymyr Zelensky has signed the law that creates conditions for further formation of the legal field in the market of virtual assets. The new market will be regulated by the National Commission on Securities and Stock Market. The signed law determines the legal status, classification and virtual assets ownership rights and determines the list of providers of virtual assets and conditions of their registration.
Chinese tech stocks tank over geopolitical risks, Covid lockdowns
Covid-19 lockdowns and China's position on the Ukraine conflict led to tech shares rout on Tuesday, slashing billions of dollars from the likes of Alibaba Group Holding and Tencent Holdings in Hong Kong, media reports said. According to South China Morning Post, Hang Seng Index hit a new six-year low as more than $460 billion of market value from tech stocks evaporated this year and Alibaba crashed by a record 12 per cent.
Current Russia-Ukraine crisis an opportunity to internationalise Indian Rupee for trade: SBI
The State Bank of India (SBI) on Monday said that the current Russia-Ukraine crisis and the subsequent decoupling of Russia from the global economy is an opportunity for the internalization of the Indian Rupee (INR). Even though the US Dollar will continue to be the denomination of global trade, an alternative settlement mechanism for international payments can boost the trade between select countries in the INR.
Ukraine conflict spreads panic waves through world of commodities
Commodity prices were already on a steady rise in 2021 and early 2022 thanks to the loose monetary policies several leading countries adopted during the Covid-19 pandemic. However, the Ukraine–Russia conflict that broke out on February 24 has spread panic waves through the world of commodities and resulted in an all-out commodity price shock globally.
The birth of a new monetary world order as Russia reels under sanctions
As US President Joe Biden unveiled new sanctions on Friday against Russia, he made it clear that the totality of the sanctions and export controls is "crushing the Russian economy". Credit rating agencies have downgraded Russia to 'junk' status. The list of businesses and international corporations leaving Russia is growing by the day, Biden said while listing the stark consequences for Russia and its economy that have unfolded since the Ukraine war.
First Covid and now Ukraine, global markets reel under blow after blow
The only positive consequence of a continuing conflict in Ukraine from a market standpoint is that the longer it goes the more likely it is to temper the recently conceived inflation fighting zeal of G7 central banks, even though the war itself is adding to the inflationary pressures, says Christopher Wood, analyst at Jefferies. In his Greed and Fear commentary, Wood wrote that this political reality is already clear in the case of the ECB which is why the euro has weakened by 3 per cent against the US dollar since the Russian invasion began.
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