Rupee falls 3 paise to 81.93 against US dollar The rupee depreciated by 3 paise to close at 81.93 against the US dollar on Monday amid strong American currency against major rivals overseas. However, the inflow of foreign funds into local equities and a downward trend in crude price capped the fall in the domestic unit, forex traders said. At the interbank foreign exchange, the domestic unit opened lower at 81.93 and moved in the range of 82.01 to 81.90 during intra-day. The unit settled at 81.93 (provisional) against the US dollar, reflecting a loss of 3 paise over the previous close. On Friday, the rupee settled at 81.90 against the dollar. Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was up 0.29 per cent at 102.54. Crude oil prices were trading lower, with the benchmark Brent crude slipping 0.16 per cent to USD 76.49 per barrel. In the domestic equity market, the 30-share BSE Sensex declined 216.28 points or 0.34 per cent to settle at 63,168.30, while broader NSE Nifty fell 70.55 points or 0.37 per cent to close at 18,755.45. Also read: USDINR outlook remains bearish following formation of lower tops, bottoms; support at 81.50, resistance at 82.30 Foreign Institutional Investors (FIIs) were net buyers in the capital markets on Friday as they purchased shares worth Rs 794.78 crore, according to exchange data.
Retail inflation in milk was reported at 8.85% in May 2023. The milk inflation has remained elevated at over 6% since August 2022. Despite India being the largest milk producer since 1998, the commodity has been the second biggest factor after cereals such as rice and wheat in driving up retail inflation in the last fiscal.
Milk has the second highest weight in the food and beverages basket of the consumer price index at 6.61%, a notch lower than cereals and products with a 9.67% weight. Organised players, including Mother Dairy and Amul, hiked prices multiple times in the last one year citing higher fodder cost, robust demand and some impact due to reports of lumpy skin disease.
Industry sources said feed cost, which has a share of more than 65% in the cost of production of milk, has increased to Rs 20/kg from Rs 8 a year ago. The finance ministry in April had attributed the elevated milk inflation to a demand supply mismatch and said it could be one of the factors apart from volatile international crude oil prices and constrained supplies of milk would influence the country’s inflation trajectory.
“Milk production has been impacted by a lumpy skin disease infecting millions of cattle in late 2022,” the ministry said in the monthly economic review, adding that the vaccination drive against the disease is expected to curb the spread and immune the cattle against the skin disease.
According to official data, currently India is the world’s largest milk producer, and has a share of 23% in global milk production. For the first time in decades, the country’s milk production is likely to have stagnated in 2022-23 due to Lumpy Skin Disease in cattle across several states and the lagged effect of Covid-19 in the form of stunting of the animals, a senior official with department of animal husbandry and dairying recently had stated. The milk production was estimated at 221 million tonne in 2021-22.