Rupee, EM monies united in fall; see more damage: HDFC Bank

After the rupee fell to its all-time low of 66.07 today, market analysts have been raising concerns about its future moves. 

Also Read: Rupee to move to 66.50/$, need tighter RBI policy: Ray Farris

Ajay Marwaha, HDFC Bank told CNBC-TV18 that most of the emerging market currencies are suffering from a depreciating currency and so is the rupee. “The bigger problem is the equity outflow and that whole sentiment could drive the currency further down," he added. Below is the verbatim transcript of his interview on CNBC-TV18 Q: How much of this is emerging market (EM) problem, how much of this is India specific problem that has led to 66/USD mark?
A: Most of the action today is an emerging market problem. The Indian problem hasn’t gone away and that is underlying but today all the EM currencies particularly the real and the lira, both are suffering. The rupee has been doing likewise. The bigger problem is the entire thing of equity outflows and that whole sentiment could drive the currency further and that is what we are all concerned about. Q: Are there any kind of signs of intervention in the currency market or are you expecting it to come through now that the rupee is at 66/USD levels?
A: We have seen some bouts of selling through the day but that have been few, far between and quite infective at the moment. The flow, the momentum of purchases is quite strong. The demand seems to be quite strong and if you correlate it to what is happening in the underlying market, this was expected. So, I don’t think we had any effective intervention at this point in time. We have seen some small bouts.