India can do little to check Rupee slide: CEA C Rangarajan

NEW DELHI: India can do little to check the slide of rupee against the US dollar, which is driven by external factors, C Rangarajan, chairman of the Prime Minister’s Economic Advisory Council has said.

"The stated policy of RBI is to prevent volatility in foreign exchange market.I think RBI will act but it is really a call of RBI and it will depend on what is happening in the market" he said at Delhi Economics Conclave organised by the finance ministry and National Institute of Public Finance and Policy.

He said rupee behaviour was predicated to that of dollar and Indian monetary authorities could not do much.

The Indian rupee hit an all-time low of Rs 53.75 vis-a-vis dollar, a over 18% drop in its value since July largely on concerns over domestic economy and US Fed’s decision to refrain from new economy boosting measures.

He said behaviour of the rupee is a reflection of Current Account Deficit and the extent of capital flows.

"If there is a temporary mismatch, this will lead to pressure on capital flows, but if capital flows pick up, then what we are now seeing, can also get reversed," he add.