The Indian rupee fell today, reigniting the speculation that the nation’s central bank will intervene to support the currency as the excessive depreciation of the rupee may lead to a surge of the inflation.
The negative impact of the European crisis hit the rupee hard and the currency fell 13 percent this year, being the worst performer among the Asian currencies. Subir Gokarn, Deputy Governors of the Reserve Bank of India, said that the currency’s decline shouldn’t be considered as a sing of “helplessness in dealing with the kind of global turbulence we are seeing”. He added: “We do have the instruments to do this in the form of strategic capital controls, which can be used to enhance the supply of foreign exchange.”
USD/INR rose from 51.2062 to 51.3750 today as of 16:24 GMT.
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