【New Delhi】Indian shares and the rupee dropped on Thursday after the US Federal Reserve announced the start of its stimulus withdrawal the previous night, sparking concerns the foreign institutional inflows might recede.
But, the decline was moderate, as key global markets had rallied, acknowledging Fed's attempts to soften the blow from the feared announcement.
While the Sensex closed 151.24 points lower, the rupee lost some value, closing at 62.1162 to the dollar, down 0.02%.
Finance Minister P. Chidambaram on Thursday said India is better prepared to deal with the situation arising out of a cut in the US bond purchases and the local markets have already factored in the impact of such a move. If any other policy responses are required, we will respond. At the moment, we think that all that has been announced has been factored in."
"Tapering of fiscal stimulus by the US Federal Reserve will not hit Indian economy as the country's foreign exchange reserves are stable and the current account deficit (CAD) for this financial year is likely to be sustainable. India is now definitely in a better position to manage its balance of payments as the government and RBI have taken effective steps to build up forex reserves and render stability to the foreign exchange market," Ficci President Naina Lal Kidwai said.
【News source】
Fed taper has little impact on India
India unfazed as Fed begins tapering; better prepared, says Chidambaram
Taper may not hit stocks, Indian rupee as CAD in better shape
US taper not to hit Indian economy; CAD stable
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