Facebook Pixel Code

Rupee better placed than many other global currencies: Finance minister Nirmala Sitharaman

The RBI has been intervening in the market since the outbreak of the Ukraine war in late February to prevent a sharp depreciation of the rupee. Since February 25, the country’s foreign exchange reserves have dropped by almost $41 billion.

The domestic currency breached the psychological barrier of 79 per dollar for the first time on Wednesday, before rising marginally on suspected RBI intervention to close at 78.97.
The domestic currency breached the psychological barrier of 79 per dollar for the first time on Wednesday, before rising marginally on suspected RBI intervention to close at 78.97.

Finance minister Nirmala Sitharaman on Thursday said the rupee’s performance against the greenback is better than that of many other global currencies despite the depreciation in recent months.

The domestic currency breached the psychological barrier of 79 per dollar for the first time on Wednesday, before rising marginally on suspected RBI intervention to close at 78.97.

Responding to a question on the rupee movement on the sidelines of an event here, Sitharaman said: “We are relatively better placed. We are not a closed economy. We are part of the globalised world. So, we will be impacted (by global developments).”

The rupee has lost 6% so far in 2022 and about 2% in June, as strong dollar, high crude oil prices and sustained capital outflows pressured the domestic currency. However, the Philippine peso has lost over 7% and the South Korean won has shed more than 8% against the dollar in 2022.

Currencies of many countries, especially the emerging markets, have been weakening sharply against the dollar, especially after the US Federal Reserve started raising interest rates to curb runaway inflation. Price pressure across economies has spiked in recent months, more so after the Ukraine war hit the global supply chains and contributed to a surge in oil prices. Consequently, central banks of key economies, including India, were forced to hike policy rates to control inflation, which will weigh down economic growth prospects.

The RBI has been intervening in the market since the outbreak of the Ukraine war in late February to prevent a sharp depreciation of the rupee. Since February 25, the country’s foreign exchange reserves have dropped by almost $41 billion.

Last week, RBI deputy governor Michael Patra said the central bank was not looking at restricting the rupee at a particular level but it had been intervening in the market to curb sharp volatility and prevent “jerky movements” of the currency.

If you are keen to know more about Nifty 50 and BSE Sensex levels and seek expert advice on what’s driving the gains and how to build your portfolio, track the latest stock market stats, share market news and top brokerage bets on Financial Express. Download the Financial Express App for the fastest and most reliable business news alerts, key investment strategies and latest movers and shakers from across financial market.

First published on: 01-07-2022 at 04:30 IST
Market Data
Market Data
Today’s Most Popular Stories ×