Rupee may be undervalued, markets can be irrational: RBI governor Sanjay Malhotra

RBI governor Sanjay Malhotra indicated that the rupee is undervalued and the central bank will intervene. The rupee closed at 96.78, down 36 paise from the previous day, hitting a five-month low. Malhotra mentioned that global AI stock corrections could attract foreign capital to India. Despite a robust services trade surplus, the current account deficit has widened due to increased merchandise trade deficit.