Exporters urged not to speculate on currency movement due to market volatility

A senior State Bank of India official on Friday urged exporters not to speculate on currency movement due to volatility in the market at the moment. "There is volatility in the currency market in the country at the moment. Exporters should not get caught on the wrong side. I urge all the exporters not to speculate on the currency movements," S S Venkatramana DMD, global markets, SBI, said.

Speaking at a webinar organised by FIEO (eastern region), he said RBI has brought in certain changes in the hedging transactions from September one, and it will be a call for the exporters how to go forward. "In India, the rate of interest is still attractive which is causing inflows of FDIs into the economy. This is causing foreign exchange reserves to increase. Exporters will have to take appropriate forex cover," Venkataramana added.

The official said SBI was the first bank in the country to come out with an emergency credit line since the outbreak of the pandemic. He said the apex bank had also stepped in with a number of measures to alleviate the problems caused by the health crisis like TLTRO (targeted long term repo operation).

According to the official, export credit forms a part of priority sector lending.