Finance Minister Nirmala Sitharaman on Monday said the country’s economic fundamentals remain robust, asserting that the rupee is performing “absolutely fine” compared with other emerging market currencies against the dollar.
Addressing a supplementary question in the Lok Sabha on the recent weakening of the rupee, Sitharaman highlighted the strength of the economy, fiscal position and prudent deficit management, which she said, has earned global praise. The FM also pointed to the country’s solid foreign exchange reserves as a key buffer. “Compared to other emerging economies, the rupee is doing fine. Absolutely fine,” she said.
Sitharaman noted that this movement was not unique to the local currency and that several other major Asian currencies have also weakened against the dollar during the same period.
Certain peers, such as the South Korean Won, Thai Baht and Philippine Peso, have declined against the dollar more than the rupee, by 4.6%, 5.5% and 4.8%, respectively, she said.
Since the commencement of the West Asia conflict on February 28, the rupee has faced notable pressure in the current fiscal. It has depreciated by 11.06% against the dollar till March 30, the highest annual decline in 14 years.
On Monday, the currency breached the 95-mark for the first time.
Minister of State for Finance Pankaj Chaudhary said that the rupee’s value is determined by market forces and influenced by multiple global and domestic factors. He assured the House that both the government and the Reserve Bank of India (RBI) are closely monitoring the currency’s movements.