Indian Rupee opened 1.50% weaker 72.44 on Tuesday after the unexpected resignation of the Reserve Bank Governor Urjit Patel on Monday evening. His resignation came four days ahead of a crucial meeting of the board of the central bank that could have discussed issues of crucial differences with the government. Another important event state election outcome later in the day.
INTRADAY RANGE - 71.53 (71.90 - 72.85) 73.25
Central bank independence has been a big topic for investors in emerging and developed markets this year. For one, worries swelled around the central bank of the Republic of Turkey and Prime Minister Recep Tayyip Erdogan, who repeatedly spoke out against the higher interest rates the market demanded in the face of a selloff in the Turkish lira USDTRY, +0.0751% .
In India, the governing Bharatiya Janata Party is waiting the results of five state elections, and preparing for a general election in the spring of 2019. Further, a debate on the so-called GDP back-series — a rebased gross domestic product statistic that is said to have an upgraded methodology, but also raised India’s growth rate significantly — has erupted and has not yet been resolved. And the RBI has come under fire from the government about its attempt to clean up state government’s balance sheets, which are weighed down by non-performing loans.
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