Falling rupee: Chidambaram meets PM, RBI chief

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New Delhi, July 15: With rupee continuing its free fall, Finance Minister P Chidambaram today met Prime Minister Manmohan Singh to discuss the economic situation. Considering the seriousness of the issue, RBI Governor D Subbarao has been called to discuss the strategy to tackle the problem.

Chidambaram is understood to have discussed the rupee and macro economic situation with the Prime Minister. He is scheduled to meet Subbarao later this afternoon.

The Finance Minister also briefed the Prime Minister about his recent Washington visit, where he pitched for US investments in India.

He had also met key policy makers including Treasury Secretary Jacob Lew. Rupee today dropped to 60.005 against the US dollar while the wholesale prices rose 4.86 per cent in June compared to 4.7 per cent increase in May.

Rupee had earlier in the month touched an all time high of 61.21 to a dollar. Among the measures considered by the government to stem the rupee's fall include floating sovereign bonds overseas.

Food prices up inflation

Adding to rupee woes is wholesale price-based inflation, which rose to 4.86 percent in June as compared to 4.7 percent in the previous month due to food prices.

Food inflation accelerated to 9.74 percent.

Onion price surged by 114 percent year-on-year. Rice became costlier by 19.11 percent, wheat prices jumped by 13.83 percent.

Prices of vegetables jumped by 16.47 percent and cereals became costlier by 17.18 percent year-on-year during the month under review.

Inflation for manufactured products stood at 2.75 percent and fuel and power inflation were recorded at 7.12 percent in June.

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