..............In other words, there's nothing substantive the government or the Reserve Bank of India (RBI) can do about the rupee. It is currently (July 8) resting on a pivotal support and may take a breather, perhaps even recovering a (very) little bit of ground. But with global markets seemingly stuck in perma-hurricane season, any respite would likely be short-lived. What they can - and should - do is infuse some strong vitamins into the country's economy. Vitamin S (for sentiment) is critical but, with credibility extremely low, stocks are near zero - the good news is that Vitamin S quickly regenerates itself once it finds the right trigger. The only other treatment - the silver bullet - is Vitamin G (for growth). The RBI should immediately cut interest rates by one per cent, with perhaps a booster dose in a few weeks.
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