Mumbai, Dec 21: Attributing the currency fluctuations to market sentiments, Union Finance Minister P Chidambaram today said Rupee exchange rate is market-determined.
Speaking to reporters, Mr Chidambaram said, ''The Government does not have a view on the Rupee as it is driven by market.'' The Rupee has risen 12 per cent this year against the Dollar, which has put stress on some sectors such as textiles and IT that depend mainly on exports. The Finance Minister admitted that strong Rupee has put stress on some sectors which will be addressed appropriately.
However, he added that the Rupee is doing well against other currencies such as Euro, Yen and there is no need for the industry to press the panic button.
The Government, which said capital inflows have caused the Rupee to strengthen, wants exporters to be more competitive and productive to cope with the effects of the rising Rupee. A higher Rupee makes Indian goods more costly overseas and erodes the revenue of the South Asian nation's exporters.