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No change in forex policy

RBI will manage impact, says Lahiri

NEW DELHI: India on Thursday expressed confidence that the Reserve Bank of India will successfully manage the impact of revaluation of the Chinese currency yuan.

"It was expected for some time. We have a flexible exchange rate... The RBI will successfully manage the impact of revaluation of yuan,'' Chief Economic Advisor Ashok Lahiri said reacting to the currency development in China.

Noting the revaluation of the yuan as an "important development,'' the RBI, in s statement, said it reiterates the continuation of the current exchange rate policy as enunciated in the Annual Policy Statement for 2005-06.

"The exchange rate policy in recent years has been guided by the broad principles of careful monitoring and management of exchange rates with flexibility without a fixed target or a pre-announced target or a band coupled with the ability to intervene when necessary,'' the RBI maintained. The overall approach to the management of India's forex reserves takes into account the changing composition of the balance of payments and endeavours to reflect ``liquidity risks'' associated with different types of flows and other requirements, it added. — PTI

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