The Reserve of India’s decision to keep interest rates steady on Friday hit forex market hard, as the rupee fell below the 74 mark against the dollar. However, the currency recovered some of the lost ground to settle at 73.77, down 18 paise.
The six-member monetary policy committee of the Reserve Bank of India on Friday refrained from increasing the repo rate, the short-term lending rate. The policy rate stands at 6.5 per cent.
In post policy press conference, RBI Governor Urjit Patel said that the recent fall in the rupee was moderate compared with other emerging markets. He did not give any band for the rupee-dollar exchange range, saying it is the market which will determine the same.
The policy-setting committee headed by Governor Urjit Patel opted to take a pause after hiking the rates in its last two successive policy meetings. The outcome was in contrast to an ET poll, where a majority of 25 economists and analysts had expected the otherwise. Read More
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