New Delhi: Finance Minister P Chidambaram on Friday said that the steep rise of the stock markets both surprised and worried him.
Speaking at the 'Hindustan Times Leadership Summit', he attributed the rise of the Sensex to dizzy heights to strong foreign inflows of funds from a number of sources and added that speculators were taking advantage of the situation.
''Our assessment is the Sensex is driven by the copious flow of funds from a number of sources abroad. To some extent, speculators are taking advantage of the Sensex, but I think things will cool down after some time,'' he said in the summit.
"If the Sensex is doing well despite the political situation, why should I be displeased", he quipped.
''The rather steep rise in the Sensex sometimes surprises me, sometimes worries me,'' he said.
He added that fundamentals do not change so rapidly from day to day. The 30-share BSE bell weather index hit its 16th record high in 17 sessions this morning, but closed down 2.1 per cent.
Chidambaram also discounted fears that FII money would flow out of the country, saying that this has not happened ever since the reform process was launched 16 years ago.
The question in this regard related to fears that hot money could move out of the country just as quickly as it came in.
Chidambaram, however, said the inflows had contributed to a hefty appreciation of the rupee. The rupee has risen more than 12.5 per cent this year.
"The rupee rise is not in our comfort zone,'' he said.
"There is nothing to suggest that inflows would move out as steeply as they had come into the country", he said.
Comments
0 comment