No fundamental rationale for rupee to depreciate to levels we saw till yesterday. It reflected overreaction of market operators. Government and RBI will do everything to ensure that rupee does not slide to unreasonable levels. Today’s correction seems to reflect that realisation.Subhash Chandra Garg (@SecretaryDEA) September 12, 2018
- The rupee traded in the range of 71.86-72.92 against the American currency during Wednesday's session. The lowest intraday level of 72.92 marked a fresh all-time low for the currency. The rupee had settled at 72.70 on Tuesday, after touching a low of 72.75 in the day.
- "Government and RBI will do everything to ensure that rupee does not slide to unreasonable levels. Today's correction seems to reflect that realisation," Economic Affairs Secretary Subhash Chandra Garg said on microblogging site Twitter.
- He said there was "no fundamental rationale" for the rupee to depreciate to levels seen till Tuesday. "It reflected overreaction of market operators.”
- The rupee has been hitting multiple lows almost every day this month, staying the worst performing Asian currency this year. It has weakened about 12 per cent this year, according to a report by news agency Reuters.
- The current account deficit hitting a five-year high and a worsening balance of payments that slipped into the red in April-June for the first time in six quarters has hit the rupee hard.
- The RBI is considering turning to wealthy Indians living abroad, like it did in 2013 when a discounted swap window lured inflows of about $34 billion. A government official confirmed that this move was being considered to stem the rupee fall, stated the Bloomberg report.
- Indian bonds also fell tracking a weaker rupee, which could stoke inflationary pressures given the rising cost of crude oil and other imported commodities, stated the Reuters report. The 10-year benchmark bond yield rose to 8.19 per cent, its highest level since November 17, 2014.
- Foreigners have sold a net $6.5 billion so far this year with most of the outflows in debt markets where investors have seen heavy mark-to-market losses due to the plunging rupee.
- Meanwhile, the dollar index, against a basket of six major currencies, was 0.15 per cent lower at 95.128 on Wednesday.
- Oil prices rose following a report that crude inventories in the United States fell and as looming sanctions against Iran raised expectations of tightening supplies, with top producer Russia warning of a "fragile" global crude market. US West Texas Intermediate (WTI) crude futures were at $69.81 per barrel at 0047 GMT, up 56 cents, or 0.8 per cent, from their last settlement. (With inputs from agencies)
Get Breaking news, live coverage, and Latest News from India and around the world on NDTV.com. Catch all the Live TV action on NDTV 24x7 and NDTV India. Like us on Facebook or follow us on Twitter and Instagram for latest news and live news updates.