India’s rupee tumbled to a record, prompting the central bank to intervene to support the currency, after the U.S. signaled it will phase out a stimulus program. Stocks and bonds plunged the most in at least a year.
India’s rupee headed for a sixth weekly drop, the longest losing streak in a year, on speculation U.S. policy makers will scale back asset purchases that have boosted inflows into emerging markets. Bonds fell on concern a weaker currency will spur inflation.
India should refrain from changing the way foreign investors in stocks and bonds are taxed, a key adviser to Prime Minister Manmohan Singh said, as the nation prepares rules to clamp down on tax avoidance.
India will take several months to reduce inflation to “an acceptable level,” and the central bank’s interest-rate increases haven’t hurt the economy, Prime Minister Manmohan Singh’s top economic aide said.
Montek Singh Ahluwalia, deputy chairman of India’s Planning Commission, said inflation may moderate after the central bank raised its benchmark repurchase rate today. Ahluwalia was talking to reporters in New Delhi.
Montek Singh Ahluwalia, deputy chairman of India’s Planning Commission, said he expects at least two $10 billion infrastructure debt funds to start this year. Ahluwalia was speaking in New Delhi today.