Finance minister Nirmala Sitharaman blamed “global factors such as the Russia-Ukraine conflict” and soaring crude oil prices for the weakening of the Indian Rupee against the US dollar.
The Indian rupee has fallen to more than 80 per US dollar for the first time on record, as the greenback extended its rally and foreign capital outflows intensified.
The rupee 80.0600 against the greenback soon after trading started, Bloomberg data showed on Tuesday.
In a written statement to the Indian parliament on Monday, finance minister Nirmala Sitharaman attributed the rupee’s sharp fall to external reasons.
“Global factors such as the Russia-Ukraine conflict, soaring crude oil prices and tightening of global financial conditions are the major reasons for the weakening of the Indian Rupee against the US dollar,” she said.
At the same time, the Indian currency has strengthened against the British pound, the Japanese yen and the euro in 2022 so far, Sitharaman added.
Impact of crude prices on trade
Higher crude prices have resulted in a deteriorating trade balance in a country that imports 80 percent of its oil needs.
India’s merchandise trade deficit widened to a record $26.18 billion in June, official data showed last week, largely because of higher crude and coal import prices.
In its monthly economic review, the Ministry of Finance said costlier imports could widen the current account deficit and cause the rupee to depreciate further.
Consumer price inflation in India, the world’s sixth-largest economy, cooled off slightly to 7.01 percent in June after hitting an eight-year high of 7.79 percent in April.
But price rises have persisted well above the central bank’s two-to-six percent target range despite consecutive interest rate hikes in May and June.
The central bank has also sold more than $34 billion of its foreign currency reserves in an effort to stabilise the rupee.
High inflation and rising interest rates in the United States coupled with fears of an impending recession in the world’s biggest economy have fuelled a broad dollar rally in recent weeks as investors turn increasingly risk-averse.
Tighter US monetary policy has exacerbated outflows from emerging markets such as India, where foreign investors have withdrawn a net $30.8 billion in debt and equity this year.
Data released last week showed US consumer price inflation hit a fresh four-decade high in June, exceeding market forecasts and stoking expectations of another large Federal Reserve rate hike next week.
Ministry of Economic Development and Trade and the Maldives Islamic Bank (MIB) has entered an agreement, aiming to expedite and streamline the registering services for businesses. The agreement was signed to enhance the quality of services, ensure information security, and facilitate an efficient registration process.
Following the signing of the agreement, Minister of Economic Development and Trade Mohamed Saeed disclosed that customer data can be readily verified with the assistance of the ministry’s Application Programming Interface (API). The minister stated that this would enable businesses to set up bank accounts in a convenient manner. Regarding this, Registrar of Companies Mariyam Waheed underscored the pivotal role API will play in authenticating businesses to customers and expediting in the verification process.
This initiative will significantly benefit individuals accessing online services from the ministry, fostering economic development within the nation. This marks the first agreement of its kind signed by the ministry.
Maldives Transport and Contracting Company (MTCC) has reported a staggering 82.9% net profit decline for Q1-2024.
According to MTCC, it earned just MVR 5.2 million in net profit for the review quarter, which came down from MVR 30.8 million in the last quarter of 2023.
The company’s revenue for Q1-2024 stood at MVR 664.4 million, which is a 15.8% drop from MVR 789.2 million generated in the Q4-2023.
Moreover, MTCC reported a whopping 94.5% decline in its Gross Profit for the review quarter, registering MVR 2.5 million in Q1-2024 compared to MVR 44.3 million.
The operating profit for the review quarter stood at MVR 41.8 million, which is a 26% drop from MVR 56.5 million in Q3-2023.
The net asset value per share dropped from MVR 227.95 in Q4-2023 to MVR 226.98 to Q1-2024, while earnings per share saw a notable decline from MVR 3.83 in the preceding quarter to just MVR 0.65 in the review quarter.
State Trading Organization (STO) has opened a showroom specialized for construction in Hulhumale’.
The showroom was inaugurated by Construction Minister Dr. Abdulla Muthalib during a special ceremony held on Tuesday night.
Speaking at the ceremony, STO’s Managing Director Shimad Ibrahim stressed the role of the company’s former managements and board members in carrying forward the company and therefore extended them gratitude.
Situated at the same location as STO’s Hulhumale’ shop – next to STO’s Smart Store near Hulhuamle’ Hospital – the construction solutions showroom was opened following renovations up to modern standards.
STO reports that all construction-related products sold by the company will be available at the showroom including some of the most renowned brands sold by the company; Makita tools, Nippon paint and concrete from prominent mix designing brands among others.
The state-owned company is prominent in the local construction industry as STO’s constructions solutions is the largest importer and seller of construction-related products in the Maldives.
STO noted that customers can now place orders for construction-related products including Makita tools and Nippon paint via the Hulhumale’ showroom which would eliminate the need to travel to Male’ to make the purchases. Arrangements have been made in the showroom to prepare the colors of Nippon paint ordered by the customers on demand.
Henceforth, they attributed the opening of the new showroom as something which would bring easements to the lives of Hulhumale’ residents and construction industry partners operating in the suburb.