Subir Gokarn, Deputy Governor at the Reserve Bank of India, comments on the rupee after it touched a record-low today. He spoke to reporters in Mumbai. The local currency weakened 0.9 percent to 52.6038 per dollar as of 11:12 a.m. in Mumbai and touched a low of 52.7288, according to data compiled by Bloomberg. “It’s not an easy judgment. It’s not something that we can say we are going to do this or we are going to do that. It’s all being considered. It’s going to be an ongoing process. That’s where we stand. “The sharpness and the speed of the movement are obviously creating some disruption. We obviously at this point, don’t know where it’s going to go. Any action will have to be viewed in terms of short-term consequences and medium-term consequences. “As we have been saying, we don’t have a target or a rate in mind, the rupee is moving according to market dynamics. It’s disruptive, there is no question. There’s an impact on companies and it’s a problem. But, any action we take now, if any, has to take into account the fact that these actions might have consequences further down the road. So, we’ve got to balance out actions now with the risks of potential increases in vulnerability later. “The immediate impact as we pointed out is possibly on the inflation rate and other risks. Actions have to be weighed in terms of their medium-term risks. We should not be looking at the short-term only when we make these judgments. Any action that has been suggested, that has been debated, also has potential adverse consequences down the road. So, we’ve got to balance out these two.”
http://www.bloomberg.com/news/2011-11-22/india-s-gokarn-says-rupee-intervention-not-an-easy-judgment-.html#