Mint Quick Edit | As the rupee sinks past 90, look at the bright side of a subtle shift in policy
While it raises India’s import bill, soft crude oil prices and our low inflation risks make that a non-issue. Low forex intervention has the additional advantage of a milder collateral fallout on rupee liquidity conditions, thus letting monetary policy operate more freely. Rupee support has a tightening effect, unless other tools reverse it, and that may go against RBI’s neutral stance.
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