US downgrade not a cause of alarm: Kaushik Basu

A rating downgrade of the United States, by Standard & Poor's, is not a cause of alarm, Chief Economic Adviser to Finance Ministry Kaushik Basu said on Monday.

Shares across Asia fell sharply on Monday despite efforts by global policymakers to stem a collapse in investor confidence after S&P downgraded US credit rating from AAA to AA+ last week.

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In early trade, the BSE Sensex fell 2.5% on Monday, while the rupee weakened past 45 to the dollar for the first time in five weeks following a global equities rout.

In an announcement early on Monday before the markets opened for trading, India's central bank said it would ensure adequate rupee and forex liquidity, a move to calm the jittery markets.

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