Amid concerns over declining rupee,finance minister P Chidambaram today said the currency will find its level as steps being taken to contain fiscal and current account deficits will improve investor sentiments.
We are committed to contain the fiscal deficit within the target and we are addressing how to finance the current account deficit. Sentiment will turn in favour of the rupee. I think rupee will find its level, he said. The rupee had touched historic low of 60.76 level against the dollar on June 26 due to heavy capital outflows amid fears of early withdrawal of US monetary stimulus. The finance minister,however,added there is no good and bad value that one could attach to the price of the rupee. Its a price. Rupee is bought and sold. Dollars are bought and sold there is a price. Its also a function of supply and demand. Its also influenced by sentiment, he said. Commenting on the burgeoning CAD,Chidambaram said,The more difficult task is to finance the CAD… It has become a serious issue because imports are rising faster than exports. And the gap has to be financed through invisibles and capital account…. but to do that year-after-year is a challenge.