"The RBI is keeping an eye on it (depreciation of rupee). They are watching the situation at the appropriate level," Mukherjee told reporters on the sidelines on the Vatsalya Mela 2011 here.
His comments came a day after the Indian rupee plunged to a 32-month low below Rs51 per US dollar on persisting demand for the US currency from banks and importers.
At the Interbank Foreign Exchange, the domestic currency closed 44 paise lower at Rs 51.34/35 per dollar yesterday.
The market was abuzz with speculation that the RBI has asked public sector banks to release dollars to arrest the fall of the rupee.
Asked what would be a comfortable rate of exchange and the likelihood of intervention by the central bank, Mukherjee said: "I am not guessing anything and I am not finding what is comfortable level. I am depending on the advice of the RBI."
The Indian rupee is the fourth most depreciated currency in the world and the most depreciated in the Asian continent.
The RBI has attributed the movement to demand-supply factors and said it is happening globally.
A weaker rupee is a matter of concern for India as it depends on imports for over 70 per cent of its oil and gas requirements and the depreciation of the local currency has made imports more expensive.
The depreciation of the rupee comes at a time when headline inflation has remained above the 9 per cent-mark for 11 consecutive months.
Earlier this week, RBI Deputy Governor Subir Gokarn had said the apex bank will intervene in the foreign exchange market only to arrest volatility.
"We intervene when there is a very strong movement in a particular direction or extreme volatility and the objective is to smooth that volatility and not fix a rate," he had said.
Gokarn had said the RBI would opt for open market operations to manage liquidity in the system only if there is stress and not to influence government bond yields.