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FM powerless against market forces
Finance Minister Yashwant Sinha said in parliament that the rupee rate was determined by market forces and the only steps he could take were to ensure orderly and stable conditions in the currency market. The government’s policy was to ensure that no undue volatility took place, he added. He said the tests in Pakistan could initially affect the rupee as markets sometimes overreacts, but then corrects itself in the longer term. He said there was no link in the recent fall in rupee value as a steady decline had been registered since 1991. Sinha pointed out that the rupee had lost 40 per cent of its value since 1991.