Crude Oil prices rebounded on Wednesday after two straight days of decline and rose more than 2 percent, on getting strong manufacturing data from US and China, reviving risk appetite, also the dollar weakened against a basket of other currencies. Though the US Energy Information Administration (EIA) data showed crude oil stockpiles rose 3.43 million barrels last week, more than expected, but the US manufacturing sector grew faster than expected in August and relieved the concern about tepid oil demand.

Oil rebounded after the U.S. Coast Guard reported the blast, which occurred 90 miles (145 kilometers) off the Louisiana coast. The Obama administration instituted a temporary moratorium on deep-water oil and gas drilling in the Gulf on May 27 in reaction to a BP Plc oil spill, the worst in U.S. history.

Meanwhile in a survey, it was shown that OPEC crude oil supply fell in August to the lowest since November 2009 as reduced supplies from Nigeria, the United Arab Emirates and Iraq offset increased output in Angola.

Benchmark crude for October delivery rose $1.99, or 2.77 percent, to settle at $73.91, after trading in a range of $71.67 to $74.48 on the New York Mercantile Exchange.

In London Brent crude for October rose $1.93 to $73.85 on the ICE.

Agriculture Minister Sharad Pawar has indicated that the Centre is going to discuss relaxing the ban on trading of sugar futures early next month. The ban, which was placed in May 2009 to avoid price rigging in commodity, is valid till end of this month.

The decision on lifting over-a-year old ban will be taken after considering production level in September, the minister added. October to September is considered as sugar season in the country. Sugar prices have witnessed sharp correction since the beginning of 2010. In January 2010 the sweetener’s price was hovering around Rs 50 per kg level which has now corrected to around Rs 30 a kg. Change in the demand-supply dynamics is one of the major reasons for sharp drop in sugar prices.

India’s sugar production is likely to stand at around 25.5 million tonnes in the next season against the demand of around 23 million tonnes. For the current season ending September 30, 2010, the projections for production are at around 18.8 million tonnes.

Sugar futures trade was banned upon demand by the Left parties who contended that manipulation in the futures trade in the commodities market played a key role in increase in prices of essential commodity. In 2010-11, sugar output is expected at 25.5 million tonnes, higher than the annual demand of 23 million tonnes. The high output estimates, although questionable at this juncture, will ensure adequate domestic supply and lower consumer prices, allowing the government to free sugar trade without worrying about prices.

Pawar has also summarily rejected the Supreme Court’s recommendations of distribution of food grains to the hungry poor of the country instead of allowing it to rot in Food Corporation of India (FCI) godowns.

Sugar production in India, the world’s second largest producer and the biggest consumer, is estimated to touch 18.8 million tonnes in the ongoing 2009-10 season, nearly 3 million tonnes more than the earlier projection. The country has imported about 6 million tonnes of sugar since early last year as sugar output in 2008-09 and 2009-10 crop-year was lower than the domestic demand. 

The growth story of India is intact and many would be interested in correlating the new symbol with its economic growth and ambition to become an economic super power.

However, the introduction of the new symbol is having a political dimension. While Pranab Mukherjee spoke about ethos of the country in Parliament, it was definitely, on the largest democracy of the world. As compared to other Asian powers, especially China, India’s strength lies in its democracy.

This new symbol is also considered as a step towards internationalisation of Indian rupee.

While the U.S. dollar, the British pound, the euro and the Japanese yen are widely traded currencies, Indian rupee is only partially convertible.

Further, majority of world’s currencies are also floating. Convertible currencies are defined as currencies that are readily bought, sold and converted without the permission from a central bank or government entity. The Indian rupee is only partially convertible as the central bank controls the international investments flowing in and out of the country.

With a new symbol, the issue of full capital account convertibility would be revived again. However, the recent global financial crisis again proved that India would not be able to take such risks though one may say this as a weakness for the Indian currency in the global arena.

Mangalore based Foradian Technologies Pvt Ltd has created a new font Rupee_Foradian.
For more details and download of this font visit: Download New rupee font

Related Article: New Symbol For Indian rupee

Gold futures settled on high note on Multi Commodity Exchange on buying support here on Saturday. Gold futures traded up; while silver futures steady to down on profit taking. Precious metals settled lower in the previous session on weak global trend. In the overseas market gold settled up but silver seen down. In the international market gold settled steady at USD1190.15/oz.

MCX’s most active Gold August contract opened down Rs.6 at Rs.18,300/10gm and moved between Rs.18,300-Rs.18,337/10gm. The contract settled Rs.29 higher at Rs.18,335/10gm. August contract volumes clocked 2287 lots.

MCX Gold mini, the most active August contract opened down Rs.18 at Rs.18,305/10gm. It fluctuated between Rs.18,300-18,346/10gm. August contract settled up Rs.19 at Rs.18,342/10gm. Total volumes in August contract clocked 4399 lots.

Benchmark Silver September contract opened Rs.14 higher at Rs.28,800/kg. The contract fluctuated between Rs.28,786-Rs.28,810/kg. Silver September contract settled up Rs.14 at Rs.28,800/kg. Total volumes clocked 1598 lots.

MCX Silver mini August futures opened down Rs.34 at Rs.29,752/kg and moved between Rs.28,750-Rs.28,810/kg. Mini silver August futures settled up Rs.9 at Rs.28,795/kg. Total volumes recorded 2718 lots.

In order to encourage active participation in the Interest Rate Futures contracts in the
Currency Derivatives Segment, currently the Exchange does not levy any transaction
charges.
In order to further encourage participation in the Interest Rate Futures contracts in
the Currency Derivatives Segment, the above waiver of transaction charges has
been extended upto March 31, 2011.
However, every Trading Member participating in trading in the Interest Rate Futures
contracts in the Currency Derivatives Segment at any time during the waiver period
shall be required to make a lump sum contribution of Rs.500/- as contribution to
Investor Protection Fund.

Source : NSE