No need to panic over rupee decline, says FM

Adds government is watching the situation, RBI will take whatever action is necessary

There is no need to react and panic over the rupee's fall, Finance Minister P Chidambaram said on Friday, a day after the Indian unit hit an all-time low against the dollar.

The rupee had slumped to a record low of 59.9850 to the dollar on Thursday, following the US Federal Reserve's statement on its plan to wind down the monetary stimulus.

"We are not insulated from what is happening in the rest of the world," Chidambaram said at a press conference. "My request is we should not react and panic. It is happening around the world."

Chidambaram said policymakers were monitoring the rupee and the Reserve Bank of India would do whatever was needed to stem the fall.

The rupee has been one of the worst performing currencies in Asia following a global sell-off triggered by fears that the US Fed might start tapering off its support for the economy.