Rupee to recoup in 2-3 months: Ministry
24 November 2012
press trust of india
MUMBAI, 24 NOV: Even as the rupee plunged to a 10-week low against the US dollar on Friday erasing almost the entire gains it made since the recent reform waves, the finance ministry today expressed optimism of a recovery before the fiscal-end and ruled out any intervention by the RBI.
“We are quite hopeful that the rupee will strengthen in the next two-three months,” economic affairs secretary Arvind Mayaram told reporters at the concluding day of the two-day Asia Securities Forum here.
Mr Mayaram hoped the currency will appreciate once the economy is back on an upward curve without any effective intervention by the RBI. “I don't think the RBI would have to effectively intervene for strengthening the rupee. We believe, once the slowdown bottoms out, the rupee will strengthen”.
The rupee lost nearly four per cent against the dollar in November alone, becoming the worst loser among the leading global currencies for the month. Last year, the Indian unit was the second worst performer after the 'real' of Brazil, losing close to 20 per cent.
On the back of reform initiatives on 14 September and 5 October, the rupee had rallied 5.1 per cent to close at 51.37 to the dollar. Since April, the rupee has fallen by more than six per cent, and it yesterday closed at 55.5350/5450 a dollar, a 10-week low.
In 2010-11, the currency appreciated by 1.1 per cent, but slid by more than 12 per cent in 2011-12 in the wake of the European crisis.
Mr Mayaram exuded confidence of meeting the target on the back of successful beginning of the Rs 30,000-core divestment programme yesterday.