Indian rupee jumps on PM's reassurance, at 65.70 against US dollar
The Indian rupee got a boost from Prime Minister Manmohan Singh's assurances in Parliament on
combating the currency's fall, gaining 85 paise to close at 65.70 against the US dollar.
Singh while addressing the Rajya Sabha on Friday said: Sudden decline in exchange rate is certainly a
shock, but we will address this through other measures, not through capital controls or by reversing
reforms. At the same time, to some extent depreciation can be good for the economy as this will help to
increase our export competitiveness and discourage imports.
Singh was confident growth in FY14 will rise to 5.5 per cent from a decade's low of 5 per cent in 2012-13.
At the Interbank Foreign Exchange Market, the local currency resumed at 67 from the previous close of
66.55 and dropped to a low of 67.43 on initial hesitancy in domestic stocks. It rebounded on dollar selling
to settle at the day's high of 65.70, a rise of 85 paise or 1.28 per cent.
The gains came a day after the battered local currency posted its biggest single-day rise in at least 15
years as the Reserve Bank of India (RBI) allowed state-owned oil refiners, the biggest buyers of dollars, to
purchase foreign-exchange through a special forex swap facility.
The sharp gains in rupee were mostly attributed to RBI intervention and PM's speech. The rupee was
getting support from the strong positive closing in the stock markets. The central bank was also seen
selling dollars twice in a day via state-run banks, which further helped the rupee. The trading range for
the rupee is expected to be within 65 to 66.50.
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