As the rupee dipped to its all time-low of 54.46 to a dollar in early trade today, leading to increasing calls for arresting its fall at any cost, RBI Deputy Governor KC Chakrabarty said the Reserve Bank intervenes in the forex market only to curb volatility and not the slide.
“We don't intervene to arrest the rupee fall, we intervene only to arrest the volatility, you must understand the difference,” Chakrabarty told reporters on the sidelines of an event here. The rupee has been depreciating for over a fortnight due to higher demand from importers and concerns over the widening current account deficit, and dipped to an all time low of Rs 54.46 to the dollar during trading earlier today.
Yesterday, it was at an all-time closing low of 53.97 to the dollar despite reported massive dollar selling by the monetary authority. In fact, the rupee has been on the down slide since last August when dollar became the most-sought after currency. Since then, it (rupee) lost nearly 24%.
Leave a Reply