RBI goes for short term rate hike to stem rupee rout | GulfNews.com

RBI goes for short term rate hike to stem rupee rout | GulfNews.com:

"

India’s boldest attempt yet to stem a rout in the rupee delivered only a modest lift in the currency but sent bond and stock prices tumbling on Tuesday, sparking concern that the unexpected measures inflict too much pain for limited gain.
Late on Monday, the Reserve Bank of India raised short-term borrowing costs, restricted funds banks could access and said it would drain cash from the market via a 120 billion rupees ($2 billion) bond sale as it sought to create demand for the rupee , which hit a record low last week.
The steps make it harder to speculate in the rupee and are intended to attract foreign inflows needed to fund a record current account deficit, but markets were not convinced."

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