Rupee gains strength after reports of government withdrawing surcharge on FPIs

By: |
Published: August 8, 2019 5:23:36 PM

The Indian currency Rupee gained strength intraday after reports that the government would roll back tax on foreign portfolio investors or FPIs, which was recently announced by the Finance Minister Nirmala Sitharaman in her maiden Budget 2019.

Rupee gains strength after reports that the government might roll back tax on foreign portfolio investors or FPIs

The Indian currency Rupee gained strength intraday after reports that the government would roll back tax on foreign portfolio investors or FPIs, which was recently announced by the Finance Minister Nirmala Sitharaman in her maiden Budget 2019. The Rupee pared early losses and is now trading at 70.65 per dollar against the previous close of 70.89. Currently, the currency is trading at 70.70 a dollar.  The equity markets saw a sharp jump after the news of the withdrawal of tax on FPIs made headlines. While the Sensex ended 636.86 points higher at a level of 37,327.26, Nifty 50 settled at 11,032.55, up 176.95 points from the previous settlement.

“The rupee along with other Asian currencies has been under pressure since the US-China trade tensions escalated. Monsoon is getting in line but floods in some areas are bad for the currency. Now, with the scrapping of article 370, fresh trade tensions with Pakistan are likely to pressurize the currency. India’s rating of GDP growth rate has also been downgraded recently. In next one and a half months, the Rupee may touch 72.20 from the current levels,” Ajay Kedia, Director, Kedia Commodity told Financial Express Online. 

Also read: Sensex logs biggest single-day gain since exit poll results on FPI tax removal buzz; will rally sustain?

The government is finally mulling the withdrawal of surcharge on FPIs imposed by the government in July, news reports said citing Reuters, driving headline indices Sensex and Nifty to single day-highs since exit poll. The government is considering to withdraw the tax by way of a notification and the revenue foregone for it will amount to only Rs 400 crore, said reports. The recent surcharge levied by the government on super-rich individuals with an annual income of Rs 2 crore or more also applied to FPIs registered in India as trusts. 

 

Get live Stock Prices from BSE and NSE and latest NAV, portfolio of Mutual Funds, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.