As the rupee plunged to a record low on Thursday, Finance Ministry said it is closely monitoring the currency movement. It also indicated that there may not be any direct intervention till it falls below a certain level. The Indian currency plunged to a new low of 68.8650 to a US dollar, falling past its previous low of 68.8450 reached on August 28, 2013. The fall was attributed to the worries around the the government’s demonetisation of 500 and 1000 rupee notes earlier this month to crack down on black money.
“We are keeping a close watch. RBI will take appropriate action in case it is warranted,” a top finance ministry official said. He indicated no direct intervention in the market till rupee is below 69 to a US dollar.
The rupee has fallen around 3 per cent so far this month, biggest decline in 14 months. The previous all time low in 2013 came after the US Federal Reserve had signalled an end to its unprecedented bond purchases, spurring an exodus of capital from emerging markets.