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Rupee depreciation not a cause of worry, says Rashesh Shah of Edelweiss
KV Prasad Jun 13, 2022, 06:35 AM IST (Published)
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Summary
Rashesh Shah, president at FICCI & CEO of Edelweiss Financial Services, spoke to CNBC-TV18 about the domestic inflows into the stocks market and shared outlook.
Rashesh Shah, president at FICCI & CEO of Edelweiss Financial Services, spoke to CNBC-TV18 about the domestic inflows into the stocks market and shared outlook.
“The pressure seen in emerging market (EM) currencies and markets is basically due to global volatility. There is no reason to be unduly concerned because markets all over the world have been stable in the last 18 months,” Shah told CNBC-TV18 on the sidelines of the 15th Annual Capital Market Conference.
With regards to India, he said, “For the first time in the last 18 months foreign institutional investors (FIIs) have sold but the equity market has remained stable. This shows how strong our internal economy is with local flows.”
“Market volatility and market falling 5-10 percent is par for the course,” he added.
On the rupee depreciation, he said, “Usually rupee depreciates by 2-3 percent every year largely because our inflation rate is higher than global inflation rate. Unfortunately, it stays stable for three years sand then falls by 8-10 percent but if one were to annualize the depreciation then there is nothing to worry about,” said Shah.
The rupee has fallen vis-à-vis the US dollar but all other currencies have also seen a sharp plunge. “If one were to compare rupee fall to that of Chinese yuan, British Pound, we haven’t fallen much,” he said.
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