Amid concerns over the steep fall in rupee adversely impacting the fisc, the Prime Minister, Dr Manmohan Singh, on Friday discussed remedial actions with his key economic advisors and the RBI Governor, Dr D. Subbarao.
Thanks to Central bank intervention, the rupee gained 27 paise to close at Rs 55.37 against the dollar on Friday. The climb from the close of Rs 55.65 on Thursday was also helped by some fresh selling of dollars by banks and exporters. Friday was the second day in a row when the rupee rose against the dollar. The local currency, which has depreciated over 13 per cent since March this year, tumbled to a historic low of Rs 56.38 on Thursday.
The deteriorating global risk sentiment and weak domestic fundamentals were seen as the main drivers for rupee depreciation.
“We had discussions on what actions can be taken (on rupee fall). We also discussed the overall situation of the economy,” Dr C. Rangarajan, Chairman of the Prime Minister's Economic Advisory Council (PMEAC), said after the meeting.
Besides Dr Rangarajan and Dr Subbarao, the Planning Commission Deputy Chairman, Mr Montek Singh Ahluwalia, was also present at the meeting.