Photo: BloombergMumbai: The Indian rupee and bond prices extended gains on Wednesday after crude oil prices slumped to a near 16-month low, and also after another open market operation announced by the Reserve Bank of India. Year to date, oil prices are down 15.3%. “For India’s external balances, lower oil prices imply some reprieve on the FY19 current account and balance of payments position”, Rao added. Rao expects that if oil prices average USD75pb this year, the current account deficit is likely to stand at -2.5% of GDP, better than our forecast of -2.7%. For further relief to the BOP, a deeper correction in oil prices requires to be accompanied by better risk-appetite.

Source: Mint December 19, 2018 03:55 UTC