This is What Niti Ayog vice Chairman Tweeted When Rupee Drops 27 Paise against Dollar for the First Time
In August, the Indian rupee settled below the 70-mark for the first time ever against the US dollar. It was reported that the local currency settled 27 paise down at 70.16. In the past few sessions the Indian currency has been under the pressure due to big meltdown in the Turkish lira. Money market players say fears of a widening trade and current account deficit are also putting pressure on the rupee.
The currency experts believe that 70 to a dollar may not be the bottom and the rupee could weaken further in the coming days. A key factor that is keeping market players on the tenterhooks is the volatility in the equity market as any FII outflow could only widen the current account deficit.
Since rupee continued to fall to new record lows, NITI Aayog Vice Chairman Rajiv Kumar said the Indian currency was overvalued and is moving towards its real value, and that it will not hurt the Indian economy.
He also tweeted “Let’s be clear, the depreciation of the Indian Rupee against the USD is not indicative of a bad time for the Indian economy. Over the past three years, the rupee has been overvalued by approximately 17 per cent and the current depreciation of 9.8 per cent since January is a move towards its natural value”.