India: Rupee falls to new all-time low
December 1, 2011
The Indian rupee (INR) continues to lose ground amid faltering economic growth and persistently high inflation. On 15 December, the rupee traded at 53.5 INR per USD, which represents a 5.4% nominal depreciation over the same day last month and marks its lowest ever recorded level. Due to the sustained decline witnessed in recent months, the rupee now depreciated an accumulated 16.8% since the beginning of the fiscal year. Against a backdrop of sustained weakness and turmoil in financial and foreign exchange markets, the Central Bank signalled its willingness to intervene in order to stem volatility in the exchange rate. However, the Central Bank Governor Duvvuri Subbarao recently stated that volatility in the foreign exchange market is expected to continue until the protracted Eurozone debt crisis is resolved.