RBI Intervenes with $3–5 Billion to Support Rupee Amid Recent Weakness
The Reserve Bank of India (RBI) reportedly sold between $3 billion and $5 billion in spot and non-deliverable forward markets on Wednesday to stabilize the rupee, according to estimates from seven traders across private, state-run, and foreign banks. Two traders suggested sales at the higher end of $5 billion, reflecting heavy activity in the non-deliverable forward segment. The RBI did not provide official comments on the intervention.
The central bank’s move fueled the rupee’s largest single-day gain in four months, continuing into Thursday when the currency reached an intraday high of 87.70 per U.S. dollar. The rupee had faced sustained pressure in recent weeks due to punitive U.S. tariffs, weak equity inflows, and rising gold import demand, hovering near a record low of 88.80 prior to RBI intervention.
Market experts suggest the intervention could signal a turning point for the rupee. Alok Singh, group head of treasury at CSB Bank in Mumbai, noted that the currency had depreciated “beyond expectations” and that the central bank’s move, though sizable, was not entirely unexpected. With volumes and volatility spiking in the interbank and broker markets, traders indicated the rupee is likely poised for further appreciation in the near term.
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