The crash of rupee is crash of confidence

The rupee has crashed from Rs 45 to Rs 54 to the dollar, before recovering slightly to Rs 52.80 on Friday. Dismayed corporations and politicians want the Reserve Bank of India (RBI) to intervene in currency markets and prop up the rupee. This would be a terrible mistake. The rupee's fall is not a technical monetary phenomenon. Rather, it signifies a loss of confidence in India by foreign investors, and by Indians too.

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