RBI Defends 77.50 Per Dollar Level

On Tuesday, the Reserve Bank of India (RBI) intervened across the foreign exchange market spot, future, and offshore, which stopped the rupee from going the past 77.50 per dollar level.

On Monday, the Indian currency opened at 77.29 per dollar and closed at 77.46. The state-run bank has sold at 77.42 levels on behalf of the central bank. Previously, the rupee ended the day at 77.33 per dollar, up 14 paise, after touching the day’s low of 77.45.

“The RBI protected the rupee, preventing it from hitting 77.50 levels. We have seen dollar selling in those levels,” said Amit Pabari, managing director, CR Forex.

“There was not much support for the rupee as exporters were not selling while the dollar was strengthening,” said Anil Bhansali, head of treasury, Finrex Treasury Advisors.

On Tuesday, Bhansali said the central bank might have sold $500-$700 million. Dealers said the central bank was seen intervening across foreign exchange markets are spot, futures and the PDF (non-deliverable forward) markets, showing its intention to defend the Indian unit amid global uncertainties, which has led investors to rush for safe-haven assets.

“The dollar traded higher as investors shed riskier assets on worries about higher interest rates and their impact on economic growth, while the dollar held near 20-year highs,” IFA Global said.

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