A day after the rupee hit a new low, breaching 70-mark against the US dollar, Union Minister Arun Jaitley on Wednesday said India’s foreign exchange reserves were comfortable by global standards and sufficient to mitigate any undue volatility in the foreign exchange market.
Jaitley, who is likely to resume his office as finance minister in a week's time, said the recent developments relating to Turkey have generated global risk aversion towards emerging market currencies and the strengthening of the dollar.
“The developments are being monitored closely to address any situation that may arise in the context of the unsettled international environment,” Jaitley said in a series of tweets.
He said India’s Macro fundamentals remain resilient and strong, re-assuring investors in the wake of the likely spread of Turkey contagion into other emerging markets including India.
Rupee regained some strength during the day on Tuesday after falling to 70.08 to a dollar but ended at an all time low of 69.93 a dollar. This was the steepest fall for Indian currency in the last five years since early September 2013.
After the currency fall to more than one rupee, investment bankers and traders apprehended that Turkey currency crisis may spill over to Asian markets as the dollar was being strengthened.
Rupee has shed close to 9% against the dollar since the beginning of this year but India's foreign exchange reserves stood at $402.70 billion in the week ended August 3, which was less $1.49 billion over the last week, the latest data released by the Reserve Bank of India showed.
Meanwhile, Jaitley's North Block office is wearing a new look with a fresh quote of paint and being sanitised before the minister rejoins. Jaitley is susceptible to infection after his recent kidney transplant operation and the doctors have advised him to restrict his public meetings to bare minimum.
