Letters: The Sebi effect

This refers to the report "Rupee slips below 60/$" (June 27). The market reacted to the Securities and Exchange Board of India's initiatives, pulling the rupee down by more than a rupee against the $ on June 26. The sudden demand for the dollar was not from regular foreign exchange seekers but from the foreign institutional investors (FII) who are pulling out their investments. The new norms in "buyback" and preferential allotment and easing in listing norms for the small and medium enterprises are welcome measures. Easing norms for FII inflows will only add to "speculative" trades in the bourses. These measures may boost the Sensex but not economic growth.

N Ramamurthy Chennai

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