INR, Crude

INR 

1) INR which was getting stronger at 40 at this time last year is now struggling at 52 and some says the situation could get worse and INR could reach 55. 

2) This benefits exporters as they are paid in $ so they got more INR for their products.

3) This also favors IT industry as most of the out sourced work is paid in $. But IT companies hedge themselves against rising INR by buying 6 months to 12 months future. So this fall of INR might not help them. 

4) Also in the current time of global recession exports are already low and Obama's protectionist policy is already affecting Indian IT. 

5) Currently INR bid/ask = 51.6/51.62

6) The Indian finance ministry has begun a public competition to select a design for the symbol of the rupee! 

http://news.bbc.co.uk/2/hi/south_asia/7925248.stm

This is historical performance of Indian Rupee: 

Crude Oil

1) Crude was falling freely for quite some time. It now shows some sign of improvement after production cut by OPEC. 

2) Reached 47.07 a barrel from 40.15 a barrel in a week. 

3) 1 Barrel is 42 Gallons or 159 Lts (US liquid Gallon is equal to 3.7854 Lts)

This is historical performance of Crude Oil:

28February2009

GDP growth of Indian at 5.3%

GDP growth of India (12 largest GDP of the world) is estimated at 5.3% for the October –December 2008 quarter, which is a 6 year low. This is mainly caused by 2.2% decline in agricultur and 0.2% decline in manufacturing sector.

First 9 months of this Fiscal GDP growth now is 6.9% (Q1: 7.9%, Q2: 7.6%, Q3: 5.3%). Projected growth for this year was 7.1%. Now to get this projected growth last quarter should have 7.7% growth. Considering recession, growth of last quarter is expected to be around 5% and so we"ll miss the projected growth by quite a margin.

How GDP is calculated?

The method of Calculating India GDP is the expenditure method, which is,

GDP = consumption + investment + (government spending) + (exports-imports)

i.e. GDP = C + I + G + (X-M)

The other two methods of calculating GDP are Product wise (Calculating the total production) and Income wise (Calculating the total incomes received by factors of production - labour & capital)

Meanwhile, US economy shrunk by 6.2% for the same period of October-December 2008. This is its worst hit since 1982.

INR at 51.12 against Dollar

INR reached its all time low of 51.12 per dollar. This is mainly due to heavy demand for dollars. Dollar gained against Euro and Pounds yesterday. So, this gave opportunity to investors to buy dollars from India and sell it outside. Widening of Fiscal deficit from 2.5% to 6% already led Re to fall below 50 mark. Taking measures for growth RBI may further cut rates. This will further bring Re down. Another impact would be on inflation which has already reached to a low of 3.2%. We might see further fall in inflation in view of rate cuts and annualisation factor.