• Investment World
• eWorld
• Brand Line
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest
• The New Manager

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources
• In Focus
• In Depth

Group Sites

• The Hindu
• The Hindu ePaper
• Business Line
• Business Line ePaper
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

Mr P. Chidambaram

Our Bureau

New Delhi, Oct. 12 The Finance Minister, Mr P. Chidambaram, on Friday said that the recent “steep rise” in stock market indices to record highs worried him sometimes, even as he asserted that the more than anticipated capital inflows were an important reason behind the sharp rise in share prices.

“The rather steep rise in Sensex sometimes surprises me, sometimes worries me. Our assessment is that Sensex is driven by copious inflow of funds from number of sources. I don’t think fundamentals have changed so rapidly from day to day to warrant such a steep rise,” Mr Chidambaram said at Hindustan Times Leadership Summit here today.

The Finance Minister also said that speculators are to some extent taking advantage of the rise in Sensex. The benchmark Sensex extended its decline, after the Finance Minister’s observations, to close at 18,419.04, down by 395.03 points from the previous day’s close.

On the rupee’s rise to nine-year highs against the US dollar, the Finance Minister said the current level was outside the Government’s comfort zone and that exchange rates have to be managed without hurting investments.

“We have to maintain competitive exchange rate. I agree that these capital inflows are more copious than we would like them to be. It’s a new situation. I think we will gain mastery over the new situation.”

Meanwhile, he told the gathering that he expects to present the Union Budget (in February) and that he would stick to the reformist course.

“It will be a Budget which will continue the effort we made in the four budgets. There is no reason to change the course. On the contrary, we must remain on the course and I will remain on the course,” he said, when asked whether the Budget would be a populist or a reform-oriented one.

Stating that the UPA Government has delivered 8.6 per cent growth rate on an average, he said the most pessimistic projection for this fiscal was 8.5 per cent and that he did not see any reason for changing the course.

More Stories on : Stock Markets | Economy | Budget

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
‘Wheat prices vulnerable to tight market situation’

Copyright © 2007, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line