What a move, Sirji!

FULL MARKS TO Governor Malhotra! The Reserve Bank of India's (RBI) action on Wednesday morning, which pushed the dollar more than 1 lower in a matter of minutes, coming as it did a couple of months after its surprise attack in the non-deliverable forward (NDF) market (again, early in the morning), has put the market on notice that it can't take the RBI lightly any more.

- JAMAL MECKLAI

While the rupee may (or may not) continue to depreciate over time, these actions, which I have little doubt will be repeated as and when-and ideally when least expected, will ensure that speculative users of the market become more circumspect. The fact that the dollar moved by more than ₹1 so quickly made it clear that rupee "weakness" was being dramatically exacerbated through position-taking by banks and, of course, exporters, who thought they were simply riding the gravy train.

I have felt for some time, and have discussed this with senior people at the RBI, that the regulator should not be batting for the big guys (banks, speculative traders). In fact, in myview, the much-lauded central bank transparency is simply a tool that helps investors and traders generate profits while limiting the risk they have to carry; so much so that over the last few decades-during which inequality has reached screaming proportions worldwide-this risk protection to the elite has not only been accepted but even given names, like the Greenspan put and the Bernanke put.