The PMs Assessment Of The Situation

There’s a lot of shrill commentary in the press on economic matters.If,like me, you happened to miss the LS debates of yesterday,here is the full test of MMSs speech in the Lok Sabha explaining his take of the economic situation in the country:

Madam Speaker and Hon’ble Members of this august House,

“The movement of the exchange rate of the Indian Rupee recently has been a matter of concern. The Rupee has depreciated sharply against the dollar since the last week of May. There are concerns, and justifiably so, of the impact this would have on our economy.

What triggered the sharp and sudden depreciation was the markets’ reaction to certain unexpected external developments. On May 22, 2013, the US Federal Reserve Bank indicated that it would soon ‘taper’ its quantitative easing as the US economy was recovering. This led to a reversal of capital flows to emerging economies which are now sharply pulling down not just the Rupee, but also the Brazilian Real, the Turkish Lira, the Indonesian Rupiah, the South African Rand and many other currencies.  Read more of this post