RBI: ‘The market decides the value of rupee, not worried about daily fluctuations’, Governor said on falling value of rupee

New Delhi| Reserve Bank of India (RBI) Governor Sanjay Malhotra said that the value of the rupee is determined by market forces against the US dollar. The central bank is not worried about the daily fluctuations.

Speaking to the media after the meeting of Finance Minister Nirmala Sitharaman and the Board of the Reserve Bank, Governor Sanjay Malhotra said that the RBI looks at the value of the rupee from a medium and long term perspective.

Regarding the impact on inflation due to falling value of rupee, Governor Sanjay Malhotra said that if rupee falls to 5%, then domestic inflation rate is affected by 30-35 basis points (bps). He also informed that RBI has kept in mind the current rupee-dollar exchange rate while deciding growth and inflation projections for the next financial year.

During this, Finance Minister Nirmala Sitharaman said that the Union Cabinet has approved the new income tax policy. He expressed hope that it will be presented in the Lok Sabha next week. After this this proposal will be sent to the Standing Committee of Parliament.