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Business News
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Rupee tumbles to 55.44 against dollar
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Posted online: Tuesday, May 22, 2012 at 10:34:35 PM
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New Delhi, May 22 : The rupee hit another lifetime low on Tuesday afternoon, falling to 55.44 against the dollar. Earlier in the day, it fell to a new low of 55.07 to the dollar, its fifth consecutive all-time low, as arbitrage measures taken by the Reserve Bank of India (RBI) late on Monday provided only a brief sentiment boost.
Finance Minister Pranab Mukherjee blamed the fall in the rupee on external factors, saying it was due to a global slowdown.
He ascribed the rupee's precipitous slide over the past five days to the euro zone crisis and to the global slowdown, adding that the Indian stock markets as well as economic growth have been hit by the slowdown.
"A number of steps have been taken to augment supply of forex to stem rupee decline," he said.
It recovered shortly after and was trading just below the 55 mark through most of early afternoon
Reserve Bank of India Deputy Governor Subir Gokarn has already said that the central bank will continue to take steps to stabilise the rupee, and added that it expected dollar flows from exporters on Tuesday and Wednesday to convert half of their exporter earnings into the rupee.
Analysts said RBI measures will only reduce arbitrage between futures and options and and over-the-counter markets and they don't address the fundamental problems.
Source-ANI
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