MUMBAI: India's boldest attempt yet to prevent a rout in therupee delivered only a modest lift in the currency but shares slumped and bond yields jumped as investors worried that policymakers might overplay their hand and damage economic growth.
The government said on Tuesday the moves were an attempt to stabilise the currency, which hit a record low last week and is down nearly 10 per cent since the start of May, but analysts said longer-term economic reforms were really what was needed.
The measures unveiled Monday night in a rare display of tactical force by a conservative central bank would make it harder to speculate in the rupee and are intended to attract foreign inflows needed to fund a record current account deficit.
The government said on Tuesday the moves were an attempt to stabilise the currency, which hit a record low last week and is down nearly 10 per cent since the start of May, but analysts said longer-term economic reforms were really what was needed.
The measures unveiled Monday night in a rare display of tactical force by a conservative central bank would make it harder to speculate in the rupee and are intended to attract foreign inflows needed to fund a record current account deficit.
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