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MUMBAI: The Indian rupee posted its largest one session fall in nearly two weeks on Tuesday as concerns that Europe’s debt crisis may worsen eroded global risk appetite hurting equities and the euro.

The partially convertible rupee ended at 49.27/28 per dollar, 1.2 percent weaker from its previous close of 48.69/70 making this the biggest single day fall for the unit since Oct 20.

Intraday, the unit had moved in a wide band of 48.8300 to 49.3150, but traders ruled out any intervention at the lower levels from the central bank stating the currency had seen far worse single day swings.

The central bank’s policy states it would intervene in the foreign exchange market only to cut volatility and not to support any levels on the rupee.

"Worry is that the Greece referendum could aggravate the euro zone crisis many times over. It could even hit the integrity of the euro. So until the Fed and the ECB release their views on the global economy, extreme volatility will be seen," said Naveen Raghuvanshi, an associate vice-president at Development Credit Bank.

The U.S. Federal Reserve will announce its rate decision on Wednesday around 1815 GMT while the European Central Bank rate announcement is due at 1245 GMT on Thursday.

The euro fell more than one percent versus the dollar and yen after Greece’s unexpected call on Monday for a referendum revived uncertainty over how the euro zone will solve its debt crisis.

Greek Prime Minister George Papandreou could be forced to announce a snap election if a public angry with swingeing austerity measures rejects the latest EU aid deal.

Last Thursday, the euro zone leaders struck a last-minute deal to contain the currency bloc’s two-year-old debt crisis.

The euro was at $1.3702 at end of rupee trade, sharply down from $1.4001 on Monday, while the index of the dollar against six major currencies was at 77.273 points versus 75.982 points.

The global risk aversion dented the local benchmark share index that ended down nearly 1.3 percent.

The one-month onshore forward premium on the rupee was at 27.50 points from 26.25 on Monday, the three-month premium was at 66 points from 68.50 and the one-year premium was at 161 points, from 169.

The one-month offshore non-deliverable forward contracts were quoted at 49.59, weaker versus the spot rupee rate. In the currency futures market , the most traded near-month dollar-rupee contracts on the National Stock Exchange and the United Stock Exchange both ended at 49.5175 while on the MCX-SX it settled at 49.5225. The total traded volume on the three exchanges was $4.68 billion.

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NEW DELHI: Finance minister Pranab Mukherjee on Monday said inflation will start easing soon as the government’s efforts to remove supply-side bottlenecks have started yielding results.

"The current inflation pressures are mainly because of supply-side constraints of agricultural products. Necessary steps have already been taken. I hope it will have its impact and from November-December onward... the rate of inflation will be moderating," Mukherjee told reporters here.

Headline inflation, which also factors in manufactured items, has been above the 9 per cent-mark since December, 2010. It was 9.72 per cent in September this year.

On the RBI’s decision last week to raise key policy rates for the 13th time since March, 2010, to tame the rate of price rise, Mukherjee said, "There was some liquidity excess which was required to be mopped up and through the adjustment of interest rates, efforts have been made to mop it up."

Following the global financial crisis in 2008, several governments across the globe have provided a stimulus to give a boost to their economies, resulting in excess liquidity in the system.

In order to check inflation, the RBI raised the short-term lending and borrowing rates by 25 basis points to 7.5 per cent and 8.5 per cent, respectively, on Tuesday.

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GENEVA: The world economy is likely to create just half of the 80 million jobs needed over the next two years, the ILO said on Monday, warning that the risk of social unrest was rising amid the morose unemployment situation.
 
"We estimate that for the next two years, the world economy would need 80 million jobs to bring the unemployment rate down to what it was before the crisis" in 2007, said Raymond Torres, who heads the International Labour Organisation’s research institute.
 
However, going by current trends, the "world economy would create just 40 million jobs," half of what is necessary.
 
Most of those new jobs would be created in the developing world, while just 2.5 million would be created in advanced economies.
 
As a result, industrialised states would be short of 24.7 million jobs during 2012 and 2013, said ILO data.
 
The acute job shortage is expected to translate into greater social tension in the advanced world.
 
In 45 countries of 118 studied, "the risk of social unrest is rising," warned the ILO.
 
"This is especially the case in advanced economies, notably the EU, the Arab region and to a lesser extent, Asia," it said.
 
Demonstrations have been raging across European cities and the United States against the financial system which they accuse of bringing about the economic crisis that left millions unemployed.
 
World unemployment was already at an all-time high of 200 million at the end of 2010, and the UN labour agency expects the situation to worsen for 2011.

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NEW YORK: US stocks tumbled 3 per cent on Tuesday after the euro zone agreement to rescue Greece and keep the sovereign debt crisis from spreading was upended.

The Dow Jones industrial average dropped 311.13 points, or 2.60 per cent, to 11,643.88. The Standard & Poor’s 500 Index dropped 36.28 points, or 2.89 per cent, to 1,217.02. The Nasdaq Composite Index dropped 82.09 points, or 3.06 per cent, to 2,602.32.

Meanwhile, Greece’s surprise move to call a referendum on the euro zone bailout deal announced last week rattled investors on Tuesday, sparking a sharp fall in global stock markets and the euro.

US stocks opened sharply lower after the benchmark Standard & Poor’s 500 index recorded its best month in almost two decades in October.

Data showing an unexpected slowdown in Chinese manufacturing, combined with news on Monday of the bankruptcy of US futures broker MF Global also hurt appetite for risk-taking, as investors rushed into less risky government bonds.

"The market did not see this Greek referendum coming, which is potentially a killer and could knock the wheels off the bus of the whole (European rescue) plan," said Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont.

Greek Prime Minister George Papandreou’s announcement late Monday that he will put Greece’s bailout to a referendum cast doubt on the euro zone’s plan to loan Athens 130 billion euros and arrange a 50-per cent write-down on its huge debt.

If Greeks vote against the rescue package, it could result in a disorderly default on their countrry’s debt and hamper efforts to contain the euro zone’s debt crisis from spiraling into a global crisis.

The referendum is not expected to be held until early 2012, which means uncertainty is likely to continue into year-end.

"The referendum is a bad idea with a bad timing. The post-summit rally is over," said Lionel Jardin, head of institutional sales at Assya Capital in Paris.

The FTSEurofirst 300 index of top European shares was down 3.2 per cent and MSCI’s all-country world stock index shed nearly 2.0 per cent.

Euro zone banks were hammered, with French banks Societe Generale down nearly 14 per cent and Credit Agricole down 1O.5 per cent.

Earlier, Japan’s Nikkei closed down 1.7 per cent.

Heavy losses across global stock markets revived safety bids for German Bunds and US Treasuries for a second day.

German Bund futures jumped more than 2 points to 137.88 to its highest level in nearly a month, while prices on benchmark 10-year Treasury notes rose a point, sending its yield down to 1.9 per cent.

In the currency market, the euro fell to a near three-week low against the dollar in the wake of the Greek referendum on its euro zone aid pact.

The euro fell to $1.36220 , its lowest since October 12 on trading platform EBS and was last at $1.36241, down 1.7 per cent.

The US dollar was little changed against the yen, a day after touching a three-month high due to Japan’s estimated $65 billion to $75 billion sale of its currency in a bid to curb its speculative rise versus the greenback. The dollar was last at 78.22 yen.

A strengthened dollar and worries about the Greek vote on its aid package hurt oil, gold and other commodity prices.

Brent crude futures in London shed 3 per cent at $106.31 a barrel, while spot gold lost 1.7 per cent at $1.681.80 an ounce.