Can RBI tame the rupee?

Moneycontrol Bureau

The rupee has plunged to fresh all-time low as Asian currencies also slipped. It breached the Rs 54 per dollar-mark in early trade, tumbling by 61 paise to Rs 54.32 per dollar.

A few experts feel that only the Reserve Bank of India can be a saviour now and big action is needed by the central bank to stabilise rupee.

In an interview to CNBC-TV18, Vivek Rajpal, Rates Strategist at Nomura India says that the RBI needs to do something in the short-term to stem this momentum given that the situation is worsening on the global front.

Maintaining a similar view, Jai Bala, Cashthechaos.com adds that rupee is headed to 57 levels and chances of it returning to 46-47 is very low.

However, Sanju Verma of Violet Arch Capital Advisors holds a somewhat different opinion. She explains that data suggests even though RBI pumped in close to USD 3.5-4 billion on Nov 23 and 24, it barely helped the rupee. It has only depreciated 20% calendar year-to-date, she adds.

"What that tells you is that the RBI