Indian Rupee has held up very well against US Dollar compared to others amid volatility: FM Nirmala Sitharaman

Pune: The Indian Rupee has held "very well" against the US Dollar compared to other global currencies and has not been affected by "fluctuations or volatility" as much, Union Finance Minister Nirmala Sitharaman said on Saturday. She, however, also assured that the government and the RBI were keeping a close watch on the situation.

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"If any one currency which has held its own and did not get into fluctuation or volatility as much as other currencies, it is the Indian Rupee. We have held back very well," said Sitharaman at a press conference here. She further emphasised that her ministry and the RBI were keeping a close watch on the matter. "The Reserve Bank of India and the ministry are keeping a very close watch on the situation," she added. Responding to a question, Sitharaman suggested that while making an assessment of the rupee's performance, the performance of the other major currencies should also be looked at.

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Sitharaman was in Pune to review a meeting of centrally sponsored schemes. The Indian rupee fell to an all-time low against the US dollar on Friday, breaching the 81 mark, as the greenback strengthened on the back of the Federal Reserve repo rate hike.

Financial experts had also sought to analyse the situation after the rupee touched the low. Geojit Financial Services Research Head Vinod Nair had said : "A rise in the US 10-year bond yield and a strong dollar index influenced FIIs (foreign institutional investors) to flee emerging markets. A fall in liquidity in the banking system, a weak currency and a current premium valuation have set the market outlook bearish for the near term."

 With reference to the Indian scenario, Nair also said: "With aggressive monetary policy action by central banks, the global growth engines are in a slowdown mode, whereas India is currently in a better position with a pickup in credit growth and an uptick in tax collection. The current volatility might persist for a while. Investors are advised to wait and watch until the dust settles.