As Rupee plunges to historic lows, Finance Minister Arun Jaitley says ‘no domestic factor’

We must bear in mind that dollar has strengthened against almost every currency, said Finance Minister Arun Jaitley.

Union Finance Minister Arun Jaitley on Wednesday said that there is no domestic factor behind record fall in Indian Rupee against the US Dollar. In a press conference in the national capital, the Finance Minister said that one must note that US Dollar has strengthened against most of the currencies across the world.

Talking about the fall in Rupee, the Bharatiya Janata Party (BJP) leader said, “If you look at the domestic economic situation and global situation, there are not domestic reasons attributable to this, but all reasons are global.”

He maintained that Rupee had not weakened and remained within a range. “We must bear in mind that dollar has strengthened against almost every currency. The Rupee has either consistently strengthened or remained in a range, not weakened,” said Jaitley.

“Most of the other currencies of the world, compared to what it was four or five years ago, Rupee is better off,” Finance Minister Jaitley added.

The statement by the Finance Minister came after Indian rupee's unabated fall continued for the sixth straight session on Wednesday, hitting yet another closing low of 71.75, down 17 paise against the US currency as surging oil prices and weak trend in emerging market currencies weighed on sentiments.

Intra-day, the domestic unit plummeted to a historic low of 71.97 a dollar before finding some respite, staging some recovery towards the tail-end. The battered rupee has lost 165 paise in the last six trading sessions.

However, the Reserve Bank swung into action to put a floor under the sliding currency and stave off a full-blown meltdown.

Worsening global trading conditions against the back drop of escalating trade wars and rising global oil prices largely caused panic among forex traders. Most emerging market currencies came under pressure, tumbling to new record lows.

Heavy sell-off in local equities also weighed on the forex front. The home currency Wednesday opened higher by 18 paise at 71.40 a dollar. The bond yield curve, however, softened to 8.05 per cent.

(With PTI Inputs)