NEW DELHI: Attributing the fall in rupee price towards the US dollar to "external factors", financial affairs secretary Subhash Chandra Garg stated on Tuesday that there is nothing to fret about as long as the depreciation is in step with different currencies.
The rupee crashed to report low of 70.09 during the day on global issues over Turkey's financial woes that have impacted quite a lot of rising markets amid the US dollar gaining energy towards different currencies.
"Rupee is depreciating due to external factors...nothing at this stage to worry," Garg stated adding external factors may ease going forward.
He stated that even supposing the rupee falls to 80 in keeping with dollar, "it will not be a concern provided all other currencies depreciate in the same range".
The Indian foreign money, he stated, continues to be higher as compared to sure different currencies.
In the current monetary 12 months, which began on April 1, the rupee has depreciated round 6.7% towards the US dollar.
Garg additionally stated that whilst the Reserve Bank of India had enough foreign exchange reserves, its intervention in the foreign money market might not be of a lot help as of now, because the weakness in the rupee used to be a results of global factors.
RBI's foreign exchange reserves had been at $402.70 billion in the week ended August three, down $1.49 billion over the preceding week, newest knowledge launched by means of the central bank showed.
RBI's stated position is that it does no longer search to focus on a specific stage for the rupee's trade rate towards the dollar, and makes use of its reserves to ease volatility in the foreign money market.
Meanwhile, SBI chairman Rajnish Kumar stated all currencies have weakened towards the dollar, but the Indian foreign money has no longer weakened very a lot compared to different currencies.
"I feel that it (rupee) should stabilise between 69 and 70 because if you look at the numbers for investment which is coming into the country -- investment in bonds, investment in equities -- this level has become attractive for foreign investment," Kumar stated.
B Prasanna of ICICI Bank stated the rupee is the victim of a contagion effect impacting all rising markets (EMs) induced by means of the Turkish crisis.
"The gradual pace of depreciation witnessed till the 69 figure levels are a result of the Yuan depreciation and the current account deficit worsening sharply from 0.6 per cent of GDP in FY'17 to an expected deficit close to 2.5 per cent of GDP this year, stemming from surging oil prices and worsening of the already negative basic Balance of Payment (BoP)," he stated.
He opined that on a medium term foundation, the rupee will want to depreciate additional to stay alongside of the inflation differentials with different trading companions.
The rupee crashed to report low of 70.09 during the day on global issues over Turkey's financial woes that have impacted quite a lot of rising markets amid the US dollar gaining energy towards different currencies.
"Rupee is depreciating due to external factors...nothing at this stage to worry," Garg stated adding external factors may ease going forward.
He stated that even supposing the rupee falls to 80 in keeping with dollar, "it will not be a concern provided all other currencies depreciate in the same range".
The Indian foreign money, he stated, continues to be higher as compared to sure different currencies.
In the current monetary 12 months, which began on April 1, the rupee has depreciated round 6.7% towards the US dollar.
Garg additionally stated that whilst the Reserve Bank of India had enough foreign exchange reserves, its intervention in the foreign money market might not be of a lot help as of now, because the weakness in the rupee used to be a results of global factors.
RBI's foreign exchange reserves had been at $402.70 billion in the week ended August three, down $1.49 billion over the preceding week, newest knowledge launched by means of the central bank showed.
RBI's stated position is that it does no longer search to focus on a specific stage for the rupee's trade rate towards the dollar, and makes use of its reserves to ease volatility in the foreign money market.
Meanwhile, SBI chairman Rajnish Kumar stated all currencies have weakened towards the dollar, but the Indian foreign money has no longer weakened very a lot compared to different currencies.
"I feel that it (rupee) should stabilise between 69 and 70 because if you look at the numbers for investment which is coming into the country -- investment in bonds, investment in equities -- this level has become attractive for foreign investment," Kumar stated.
B Prasanna of ICICI Bank stated the rupee is the victim of a contagion effect impacting all rising markets (EMs) induced by means of the Turkish crisis.
"The gradual pace of depreciation witnessed till the 69 figure levels are a result of the Yuan depreciation and the current account deficit worsening sharply from 0.6 per cent of GDP in FY'17 to an expected deficit close to 2.5 per cent of GDP this year, stemming from surging oil prices and worsening of the already negative basic Balance of Payment (BoP)," he stated.
He opined that on a medium term foundation, the rupee will want to depreciate additional to stay alongside of the inflation differentials with different trading companions.
Government attributes rupee fall to external factors, says nothing to worry
![Government attributes rupee fall to external factors, says nothing to worry]()
Reviewed by Kailash
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August 14, 2018
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