Mayaram meets treasury heads of foreign banks on rupee fall

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SummaryThough Mayaram spoke to reporters, he refused to comment on the outcome of the meeting

Economic Affairs Secretary Arvind Mayaram on Saturday discussed the continuing rupee fall and the resultant macro-economic impact with the treasury heads of leading foreign banks.

The closed-door meeting held at the LIC headquarters here was attended by treasury heads of foreign banks like Standard Chartered, HSBC, among others.

Though Mayaram spoke to reporters, he refused to comment on the outcome of the meeting. The participants at the meeting also refused to comment.

According to a source, he discussed the crucial NDF (non-deliverable forwards) market, which largely influences the movement of rupee in the domestic market.

The meeting assumes importance as foreign banks are big players in the NDF market and its influence on the market is high as volumes are large when compared with the domestic market.

NDF deals are forward transactions settled in dollars because the rupee, being not fully convertible, cannot be delivered outside the country.

On the June quarter GDP numbers, he said the reading was expected, but said there are chances of revival in the second half.

“One must remember that both the Prime Minister and the finance minister said in the first quarter there would be a flattish growth because the spillover of last years’s slowdown, especially a very sharp fiscal correction that took place. So the number was expected,” he said.

Mayaram added that revival of growth in the second-half will be driven by higher government expenditure and also the project approvals that have come through.

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