RBI Governor Says Indian Rupee is Undervalued
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The Reserve Bank of India (RBI) Governor Sanjay Malhotra has stated that the Indian rupee is 'undervalued' in both nominal and real effective exchange rate (REER) terms. He attributed the rupee's weakness to global factors such as geopolitical tensions and emerging market volatility, rather than domestic economic weakness. The Governor clarified that the RBI does not target any specific exchange rate or band, but intervenes to curb excessive volatility. An undervalued rupee boosts exports and makes imports expensive, which can impact inflation and trade deficit.
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