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'Rupee at its current value is well corrected'

December 09, 2013 14:45 IST

'Rupee at its current value is well corrected'

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With rupee firming to 60.9 against the dollar, Economic Affairs Secretary Arvind Mayaram on Monday said it has reached its real value.

"The rupee is now at its real value," he told reporters.    

He, however cautioned that ‘there should be no exuberance’.

Extending its rising streak for the fourth straight day, the rupee appreciated by 51 paise to trade at nearly four-month high of 60.90 against the dollar in early trade on Monday on sales of the US currency by banks and exporters and sustained foreign capital inflows.

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Image: A cashier counts Indian rupee currency notes inside a bank in Mumbai December 6, 2013.
Photographs: Danish Siddiqui/Reuters

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Besides, a higher opening in the domestic equity market, where the Sensex soared to an all-time high of 21,483.74 points after Bharatiya JP's victory in state Assembly elections and strengthening of other currencies against the dollar overseas, supported the local currency, forex dealers said.

The rupee had touched a life time low of 68.85 against the dollar in the last week of August after the US Federal Reserve started discussions on tapering its fiscal stimulus.

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Image: A streetside restaurant owner keeps money received from a customer in Mumbai.
Photographs: Danish Siddiqui/Reuters

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'Rupee at its current value is well corrected'

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A record current account deficit on back of high gold imports too was pressuring the rupee value.      

However, there has been significant improvement on the CAD as it narrowed to $5.2 billion or 1.2 per cent of GDP in the second quarter of the current fiscal.

The deficit was at $21 billion, or 5 per cent of the GDP in the same period of last year.


Photographs: Reuters
Tags: GDP , CAD

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