Tag: oil

Sri Lanka seeks USD 500-million loan from India for fuel purchases amid forex crisis, BFSI News, ET BFSI

Banking & Finance

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Colombo, The Sri Lankan government on Saturday said it is continuing efforts to secure a USD 500 million loan from India to ensure fuel supplies amid a severe foreign exchange crisis in the island nation. “The proposal has been sent to the Treasury for approval and would be submitted to the Cabinet thereafter,” said Energy Minister Udaya Gammanpila.

He said the Cabinet had already sanctioned USD 3.6-billion loan from Oman for fuel purchases.

Gammanpila indicated that continuous fuel supplies can only be guaranteed till January next year as the island was facing a foreign exchange crisis and higher global prices.

Long queues were seen at fuel pumps since Thursday due to speculation that retail prices would be hiked by the state fuel corporation.

Lanka IOC (LIOC), the subsidiary of Indian Oil Corporation in Sri Lanka, had hiked the retail prices of both petrol and diesel by Rs 5 per litre. The new prices were effective from Thursday midnight in the wake of the rising global oil prices.

State-run Ceylon Petroleum Corporation has asked the government to allow a price hike in view of its losses.

Gammanpila ruled out a price revision for the time being. He also blamed the opposition for spreading rumours of an impending fuel shortage in the country.

The price hike in the global oil prices has forced Sri Lanka to spend more on oil imports this year. The country’s oil bill has jumped 41.5 per cent to USD 2 billion in the first seven months of this year compared to last year.

Sri Lanka is facing a severe foreign exchange crisis after the pandemic hit the nation’s earnings from tourism and remittances, Finance Minister Basil Rajapaksa had said last month.

The country’s gross domestic product contracted by a record 3.6 per cent in 2020 and its foreign exchange reserves plunged by half in one year to just USD 2.8 billion in July.

This has led to a 9 per cent depreciation of the Sri Lankan rupee against the dollar over the last year making imports more expensive.



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Rupee inches 4 paise higher to 73.25 against US dollar, BFSI News, ET BFSI

Personal Finance

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MUMBAI: The Indian rupee appreciated 4 paise to 73.25 against the US dollar in opening trade on Tuesday, tracking a positive trend in domestic equities.

At the interbank foreign exchange, the rupee opened at 73.26 against the dollar, then inched higher to 73.25, up 4 paise over its previous close.

On Monday, the rupee had settled at 73.29 against the US dollar.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was down 0.12 per cent at 92.54.

A strong rally in the domestic equity markets and a weak American currency in the overseas markets also supported the rupee sentiment.

According to Anil Kumar Bhansali, Head of Treasury, Finrex Treasury Advisors, the rupee which has appreciated nearly 100 paise since Friday, has been gaining on bountiful corporate inflows.

“RBI has been present intermittently and equity inflows have also been aiding the rupee after FED rhetoric on Friday,” he added.

The US Fed chief Jerome Powell’s speech at Jackson Hole Symposium was ‘dovish’ and expressed hope that the Fed will keep supporting the market with low interest rates, traders said.

Global oil benchmark Brent crude futures fell 0.48 per cent to USD 73.06 per barrel.

On the domestic equity market front, BSE Sensex was trading 87.09 points or 0.15 per cent higher at 56,976.85, while the broader NSE Nifty advanced 21.55 points or 0.13 per cent to 16,952.60.

Foreign institutional investors were net buyers in the capital market on Monday as they purchased shares worth Rs 1,202.81 crore, as per exchange data.



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Dollar near 2-week low as investors look to US jobs data, BFSI News, ET BFSI

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TOKYO: The dollar hovered near two-week lows against a basket of currencies on Tuesday with trade seen driven by month-end flows as investors looked ahead to US jobs figures later in the week.

The US currency steadied from falls after Federal Reserve Chair Jerome Powell on Friday offered no signal on when the central bank plans to cut its asset purchases beyond saying it could be “this year.”

“The payroll data will be the next highlight given the focus on the Fed’s taper. A strong reading will boost expectations the Fed will give markets prior notice in September before a formal decision in November,” said Yukio Ishizuki, senior strategist at Daiwa Securities.

Weaker jobs numbers could instead cement a case for later action – a pre-announcement in November with a formal decision in December.

Trade on Tuesday, however, is likely to be driven more by month-end flows from various businesses for their import and export transactions.

In early trade, the euro held firm at $1.1799, near Monday’s three-week high of $1.1810.

The euro zone’s consumer price data due at 0900 GMT is expected to show that inflation in the currency bloc has gathered pace in August.

Sterling fetched $1.3762 while the yen was little changed at 109.98 yen to the dollar.

The dollar index stood at 92.698, near Monday’s two-week low of 92.595.

In Asia, China’s official PMI due around 0200 GMT is being closely watched for clues on the extent of the impact caused by the outbreak of the Delta variant in the country.

The offshore Chinese yuan stood at 6.4648 per dollar , not far from a three-week high of 6.4595 touched on Friday.

The Australian dollar, often seen as a proxy bet on the Chinese economy, stood at $0.7292, having peaked on Friday at $0.7317.

The Canadian dollar fetched C$1.2610, having reached a two-week high on Monday, thanks in part to the Canadian current account surplus widening more than expected due to robust oil prices.

Oil prices strengthened to three-week highs as US Gulf Coast platforms, refineries and pipelines grappled with uncertainty on restart timelines after Hurricane Ida wreaked havoc on the region.

Emerging market currencies also held firm, with the MSCI emerging market currency index hitting a three-week high of 1,733.33 on Monday. It last stood at 1,732.54.

In cryptocurrencies, bitcoin eased to $47,626 while ether held slightly firmer at $3,277.



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Rupee rises 9 paise against US dollar in early trade

Banking & Finance

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The rupee appreciated by 9 paise to 72.46 against the US dollar in opening trade on Thursday, supported by positive domestic equity markets and easing crude prices.

However, a strong US dollar against major currencies overseas restricted the rupee’s rise, forex dealers said.

At the interbank forex market, the local unit opened at 72.48 against the US dollar, then inched higher to 72.46, registering a rise of 9 paise over its previous close.

On Wednesday, the rupee had settled at 72.55 against the American currency.

On the domestic equity market front, the 30-share BSE benchmark Sensex was trading 292.68 points higher at 50,094.30, and the broader NSE Nifty rose 90.50 points to 14,811.80.

After its two-day policy meeting, the US Fed reassured investors that it expects to keep its key interest rate near zero through 2023.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, surged 0.10 per cent to 91.53.

Brent crude futures, the global oil benchmark, fell 0.69 per cent to $67.53 per barrel.

Foreign institutional investors remained net buyers in the capital market as they bought shares worth ₹2,625.82 crore on Wednesday, according to exchange data.

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