Rupee held its own against dollar. What about other currencies: FM Sitharaman

Updated on Sep 24, 2022 11:06 PM IST

Nirmala Sitharaman, who is on a three-day visit to Pune in Maharashtra, asked a reporter to study how currencies, other than the Rupee, are performing against the dollar in the latest round of depreciation.

Union finance minister Nirmala Sitharaman. (Photo by Pratham Gokhale/Hindustan Times)
Union finance minister Nirmala Sitharaman. (Photo by Pratham Gokhale/Hindustan Times)
By | Edited by Sohini Goswami, New Delhi

Union finance minister Nirmala Sitharaman on Saturday said the Indian rupee had “held back very well” against the dollar in comparison to other currencies. Her statement came at a time when the Indian currency hit a record low against the US dollar.

“If any one currency which has held its own and did not get into fluctuation or volatility as much as other currencies, it is the Indian rupee. We have held back very well,” the finance minister was quoted as saying by news agency PTI.

Also Read | India's forex reserves hit near 2-year low

She said the Reserve Bank of India and the finance ministry are keeping a “very close watch” on the situation.

Sitharaman, who is on a three-day visit to Pune in Maharashtra, also asked a reporter to do a study on how the other currencies are behaving against the US dollar in the latest round of depreciation.

The Rupee depreciated 30 paise to close at a fresh lifetime low of 81.09 against the dollar on Friday, weighed down by the strong American currency abroad and risk-off sentiment among investors, PTI reported. On Thursday, the rupee slumped by 83 paise - its biggest single-day loss in around seven months - to close at 80.79 (its previous record low).

This was the third straight session of loss for the rupee during which it lost 124 paise against the dollar. Citing forex traders, the PTI report added that escalation of geopolitical risk in Ukraine and rate hikes by the US Fed and Bank of England in order to check inflation eroded risk appetite.

According to experts, the Ukraine war has pushed up commodity prices, triggering a record increase in inflation in the developed world, resulting in steep rate hikes by the US Fed.

The RBI has been deploying the dollar reserve to defend the Rupee and has exhausted billions of dollars of currency assets in the process. There have also been policy moves to attract more deposits from the diaspora via further incentives and other such attempts to stem the decline.

(With agency inputs)

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