Page 34 - The Indian EYE 080522

BUSINESS EYE AUGUST 05, 2022 | The Indian Eye 34

Worry signs all over as Indian rupee

continues to slide against US dollar

India’s foreign exchange (forex) reserves continued to slump by $7.541 billion to

$572.712 billion for the week ended July 15, the lowest level in 20 months

OUR BUREAU
New Delhi
fter touching an all-time low
and psychologically crucial
Alevel of 80 per US dollar last
week, the Indian currency rupee
traded largely steady on Monday.
At the time of writing this re-
port, the rupee traded at 79.82, data
showed. An elevated risk appetite in
the domestic financial markets and
softening of crude oil prices prevent-
ed further depreciation in the rupee,
said brokerage house ICICI Securi-
ties.
Indian equity markets have
recorded their best weekly perfor-
mance during the past week, sup-
ported by renewed buying, espe-
cially in banking and IT stocks as
well as the return of foreign invest-
ments into the Indian markets after
months. This possibly has supported
the rupee. Rising prices of petrol has contributed to the rupee depreciation (ANI)
The Reserve Bank of India Gov-
ernor Shaktikanta Das on Friday
said the central bank will continue the market through liquidity man- India’s exports during each enhancement of capacity; timely use
to engage with the foreign exchange agement, including through the sell- month of the current year have been of trade remedial options; adoption
market and ensure that the rupee ing of dollars. higher than those of the correspond- of mandatory technical standards;
finds its level in line with its funda- The ongoing Russia-Ukraine ing months of the previous year. enforcing rules of origin; and tariff
mentals. conflict, soaring crude oil prices, The minister noted that while the measures/inverted duty correction
Speaking at an event, the Gov- and tightening of global financial Indian Rupee has weakened against etc.
ernor reiterated the central bank conditions are major reasons for the US Dollar, it has strengthened Besides, the Minster stated, the
does not have any particular level of the weakening of the Indian rupee, against other major currencies such Department of Commerce has been
the rupee in mind, but it would like which slipped below 80 against the as the British pound, the Japanese carrying out import data monitoring
to ensure its orderly evolution and US dollar recently, the government yen and the Euro during 2022. on a monthly and annual basis to
have zero tolerance for volatile and said in Parliament on Tuesday. The overall impact of exchange identify any visible changes and to
bumpy movements. In a written reply to a question rate depreciation on domestic pric- monitor surges in imports.
Widening trade deficit, strength in the Rajya Sabha, Union Minister es depends on the extent of pass- All concerned Ministries/De-
in the US dollar, fund outflows, and of State for Finance Pankaj Chaud- through of international commodity partments are apprised of item-wise
buoyed global crude oil prices had hary said, “global factors such as prices to the domestic market, the imports surge at 8 HS digit level on
been weighing on the currency. The the Russia-Ukraine conflict, soaring minister said. a monthly basis such that appropri-
rupee depreciated 6-7 per cent so far crude oil prices and tightening of Giving more details, the min- ate action may be initiated where
in 2022. global financial conditions are the ister stated that the Department of necessary. A Position paper on the
India’s foreign exchange (forex) major reasons for the weakening of Commerce regularly monitors and structure of Imports is also circulat-
reserves continued to slump by the Indian Rupee against the US sensitizes line Ministries/Depart- ed to all concerned Ministries/De-
$7.541 billion to $572.712 billion for Dollar.” He said that the exchange ments and other stakeholders from partments annually since 2014, the
the week ended July 15, the lowest rate is only one of several different time to time and in various forums minister added.
level in 20 months, as the Reserve factors such as demand for domes- to address the challenges arising out Further, the minister stated
Bank of India (RBI) likely used its tic and foreign goods, commodity of the depreciation in the value of that there is an Importing Monitor-
war chest to defend the rupee. prices, crude oil prices, etc, which currency. ing System for providing advance
India’s forex reserves in the past affect India’s export and import de- Measures taken by the govern- information on imports to the gov-
few months have declined by over mand. India’s merchandise exports ment include addressing domestic ernment and stakeholders for steel,
USD 40 billion. touched a record high of USD 421.9 supply rigidities and looking at do- non-ferrous metal, coal and chips
Typically, the RBI intervenes in billion during 2021-22. mestic production opportunities/ (integrated circuits).

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