Millennium Post

RBI to take steps to arrest rupee fall

Amid steep decline in the value of rupee, the Reserve Bank of India (RBI) on Thursday said that it is monitoring the situation and will do whatever is necessary to check the currency's fall.

'RBI will do whatever is necessary. Some structural changes are necessary for improvement in current account. Meanwhile, the RBI is monitoring the situation and we will do whatever is necessary, consistent with our policy,' RBI governor D Subbarao said while addressing a press conference after a meeting of the central bank board here.

Pointing out that the rupee has been depreciating over the last three to four months, he said, 'RBI is continuously monitoring the situation. We have taken action through current account flows, encouraged inflows and also (steps) to curb speculation.' After losing ground three on Thursday touched its lifetime low of 56.38 to a dollar but later recovered around the same time when Subbarao was addressing media here.

Since 1 March, rupee has lost over 13 per cent and 11 per cent since the presentation of Budget on 16 March in the face of withdrawal of funds by foreign investors from stock markets.

The Budget contained proposals like retrospective taxation and general anti avoidance rules (GAAR).

The movement of rupee, Subbarao said 'is a function of external situation as well as development in current account and capital account and balance of payments'.
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