This steady rise is attributed to the RBI’s intervention in the foreign exchange market, coupled with changes in the value of foreign assets held in reserves. The central bank actively manages both the spot and futures markets to curb undue volatility in the rupee.
As a result, the rupee strengthened nearly 0.1% in the week ended September 13, marking its strongest weekly performance since late June.
Read also: RBI’s September bulletin highlights strong drivers of domestic growth
India’s foreign exchange reserves also include its reserve tranche position at the International Monetary Fund (IMF), further increasing the country’s financial protection against global uncertainties.
The RBI’s September bulletin on Friday also revealed that the central bank purchased a net $6.93 billion in the spot forex market in July to stabilise the rupee, which had seen its biggest monthly fall since March.
These interventions highlight the central bank’s proactive measures to manage monetary volatility amid changing global economic conditions.
First published: September 20, 2024 20:11 IS
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