Indian domestic currency performs all-time low on Friday. The rupee first time hit 79 against the US dollar. However, the declining performance of the rupee has been continuing for a long time.
The rupee closed near 79 per US dollar on Wednesday though it rose to 78.90 in early trading, and it again fall on Friday.
Meanwhile, in the ongoing depreciation prospects, Finance Minister Nirmala Sitharaman on the sidelines of an event said on Thursday that the domestic currency is relatively better placed than other global currencies against the US dollar.
She said that India is a relatively better place, not a closed economy and it is a part of the globalized world. “So, we will be impacted[by ongoing international situation].”
Ukraine and Russia War is negatively impacting currency trading. The Reserve Bank of India has been taking steps to stop the depreciation of the rupee. The RBI is using foreign reserves to contain the decline effect, the foreign exchange reserves also have declined by 40.94 billion US dollars since February.
The RBI Deputy Governor, Michael D. Patra said that the Reserve Bank will not permit ‘jerky movements’ of domestic currency and he also emphasized that the rupee is being seen less decline in recent times.
He said that RBI will work for domestic currency stability, and we are on it. The Central Bank is there in the market and will not allow any “disorderly movement” of the rupee. Certainly, RBI will not permit any jerky movements.
The Central government has also taken several steps to contain the rupee decline on Friday. The government has decided to increase the customs duty on gold and increase the taxes on the export of petrol, diesel, and Automatic Transmission Fuel (ATF). The tax is increased by 6₹ per liter on petrol export, on diesel export, 13₹ per liter. The import duty on gold is increased to 12.5 percent from 7.5 percent.
All these steps have been taken in the order to control the demand for the US dollar which will help the rupee to remain in control brackets.
