Article;
RBI to Intervene in Forex Market Only to Curb Volatility-D Subbarao
Comment;
I think Subbarao is
right when he says he is not targeting the exchange rate. I agree that it is
futile because exchange rate tells, unlike before what i used to to think,
about the stage of development. It tells us nothing.... For an exmaple i would
mention the exchange rate of Japan which is above 100 Yen and now today i read
that the value of Indonesian rupaiyah at 10 000 i mean it is so cheap, the
currencies, and cheaper than INDIA. So why target a level? Cheap Goods and
Services increase welfare through trade (better income) but it is an irony that
the government bets on another people (foreign) income to increase demand for
their products and internally we fight in deflation...
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