In early Tuesday trade, the rupee gained 26 paise to 82.62 against the US dollar, following a positive trend in domestic stocks. In early Tuesday trade, the rupee gained 26 paise to 82.62 against the US dollar, following a positive trend in domestic stocks.
The domestic currency opened at 82.71 against the dollar at the interbank foreign exchange, but it gained some ground to quote at 82.62, up 26 paise from its previous close.
The rupee lost 9 paise to end the previous session on Friday at 82.88 against the dollar.
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Due to Diwali, the forex market was closed on Monday.
The dollar index, which measures the strength of the dollar against a basket of six currencies, fell to 111.85 by 0.12%. The global benchmark for oil, Brent crude futures, increased by 0.28 percent to USD 93.52 per barrel.
The 30-share BSE Sensex was up 51.96 points, or 0.09 percent, to 59,883.62 on the domestic equity market. In a similar vein, the overall NSE Nifty gained 0.13 percent, or 23.80 points, to 17,754.55.
According to exchange data, foreign institutional investors (FIIs) were net sellers in the capital markets on Monday, selling shares worth Rs 153.89 crore. Ashima Goyal, a member of the BI Monetary Policy Committee (MPC), has stated that demonetization will assist the nation in moving toward the ideal situation in which low taxes are imposed on a large base. She has attributed the rise in tax collections to demonetization. One of the main goals of the unprecedented decision that was made on November 8, 2016, was to reduce the flow of black money and encourage digital payments. Prime Minister Narendra Modi made the announcement that the old Rs 1,000 and Rs 500 banknotes would be demonetized.
Goyal stated that demonetization enhanced digitization and formalization in the economy and reduced tax evasion, despite having further to go. He noted that demonetization had short-term costs but some long-term benefits.
“It contributed to the current buoyancy of the country’s taxes.”She stated to PTI, “This helps us move toward the ideal of low tax rates on a large base.”
On October 9, the tax department reported that the gross collection of tax on individual and corporate earnings had increased by nearly 24% to Rs 8.98 lakh crore so far this fiscal year.
In September, GST collections remained above Rs 1.40 lakh crore for the seventh consecutive month, reaching Rs 1.47 lakh crore. This is a 26% increase over last year, indicating that tax collections are still strong. However, earlier this month, the former president of the Congress, Rahul Gandhi, stated that the BJP’s farm laws, demonetization, and GST policies are weapons aimed at India’s poor and small business owners.
Central Bank Digital Currency (CBDC):
Goyal stated in response to a question regarding the Central Bank Digital Currency (CBDC) that the CBDC’s goals are to reduce cash use and add functions to the existing payment system rather than replacing it.
She made the remark that “CBDC can certainly meet new needs in the digital age, reach remote areas, improve financial inclusion, and save costs since cash is expensive and cumbersome.”
E-Rupee:
The Reserve Bank of India recently stated that it would soon begin the pilot launch of the e-rupee for specific use cases in an effort to boost India’s digital economy, improve payment systems, and prevent money laundering. The Reserve Bank of India (RBI) stated in a concept note on Central Bank Digital Currency that CBDC is intended to complement rather than replace existing forms of money and is intended to provide users with an additional payment option rather than supplant existing payment systems.
A digital version of currency notes issued by a central bank is known as CBDC.
Even though most central banks are looking into issuing CBDC, the main reasons for doing so depend on the requirements of each country.
Goyal responded to a question regarding India’s expanding trade deficit by stating that there are a number of policy levers available to reduce the deficit. Some of the shorter-term measures include reducing aggregate demand and depreciating exchange rates.
She says that longer-term sustainability-enhancing measures like reducing oil intensity, reducing dependence on energy imports, and encouraging exports should get more attention.
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