On a day when the Rupee hit a two-year high, RBI Governor Duvvuri Subbarao said that the Reserve Bank would “intervene if inflows are lumpy and volatile”.
Referring to the record
$22-billion FII investments in the stock markets this year, Subbarao said: “We are watching the situation and our policy is clear. We will intervene if (FII) inflows are lumpy and volatile or they disrupt macro economic conditions.”
He was here for a meeting of the RBI board.
Finance Minister Pranab Mukherjee had in a television interview ruled out curbing FII inflows.
The rupee rose to touch a 25-month high of 44.06 against the US dollar on Friday.
According to reports, RBI had on Thursday bought dollars in the foreign exchange markets to arrest the rising rupee.