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Rupee tumbles to 55.44 against dollar | The rupee hit another lifetime low on Tuesday afternoon,
falling to 55.44 against the dollar. Earlier in the day, it fell to a new low of 55.07 to the dollar, its fifth consecutive all-time low, as arbitrage measures
taken by the Reserve Bank of India (RBI) late on Monday provided only a brief
sentiment boost. Finance Minister Pranab Mukherjee blamed the fall in the rupee
on external factors, saying it was due to a global slowdown. He ascribed the rupee's
precipitous slide over the past five days to the euro zone crisis and to the global
slowdown, adding that the Indian stock markets as well as economic growth have
been hit by the slowdown. "A number of steps have been taken to augment supply
of forex to stem rupee decline," he said. It recovered shortly after and was trading
just below the 55 mark through most of early afternoon Reserve Bank of India Deputy
Governor Subir Gokarn has already said that the central bank will continue to
take steps to stabilise the rupee, and added that it expected dollar flows from
exporters on Tuesday and Wednesday to convert half of their exporter earnings
into the rupee. Analysts said RBI measures will only reduce arbitrage between
futures and options and and over-the-counter markets and they don't address the
fundamental problems. |
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