‘Rupee holding well against EM peers’: Shaktikanta Das

Share Us

362
‘Rupee holding well against EM peers’: Shaktikanta Das
23 Jul 2022
6 min read

News Synopsis

Shaktikanta Das, governor of the Reserve Bank of India, assured on Friday that the domestic currency is holding up well when compared to peers from advanced and emerging markets (EM), such as the Japanese Yen, British Pound, and Euro. Fears of inflation, selling by FIIs, a strengthening US dollar, and rising commodity prices have all contributed to the recent slump in the rupee.

Shaktikanta Das stated at an event today that the rupee is holding well because of India's underlying sound and resilient macroeconomic fundamentals. He emphasised that the RBI provides US dollars to markets in order to make sure that the foreign exchange market has enough liquidity.

In his speech, the RBI governor noted that the Covind pandemic, the Russia-Ukraine conflict, high inflation, supply-chain disruptions, elevated commodity prices, recessionary fears, tightening monetary policy by central banks, high-interest rates, and a strengthening US dollar are all causing instability in the country.

These factors collectively are causing issues with financial stability in developing nations like India, which is causing the depreciation of EM currencies.  “RBI has been supplying US dollars to the market to ensure adequate supply of liquidity. Also, it is necessary to look at unhedged forex exposures factually, rather than being alarmed by it,” Das said.

TWN Express News