Rupee, shares punished, markets look to RBI
Friday, 24 October 2008
MUMBAI (New Delhi) Oct 23 (Reuters): The rupee fell to a record low and shares ended at their weakest in more than two years Thursday as a global rout of equities washed through India's markets.
All eyes were on Friday's monetary policy review, and ahead of it the Reserve Bank of India (RBI) pledged to respond swiftly and pre-emptively to preserve financial and price stability.
The central bank slashed its key lending rate by 100 basis points to 8.0 percent this week, joining central banks across the world this month in easing policy to combat slowing growth, and a Reuters poll showed few market watchers expected another cut as soon as Friday.
India's shares and rupee have suffered from the global turmoil as foreign funds have fled emerging markets, and the interbank lending market seized up briefly earlier this month.
All eyes were on Friday's monetary policy review, and ahead of it the Reserve Bank of India (RBI) pledged to respond swiftly and pre-emptively to preserve financial and price stability.
The central bank slashed its key lending rate by 100 basis points to 8.0 percent this week, joining central banks across the world this month in easing policy to combat slowing growth, and a Reuters poll showed few market watchers expected another cut as soon as Friday.
India's shares and rupee have suffered from the global turmoil as foreign funds have fled emerging markets, and the interbank lending market seized up briefly earlier this month.