Stories
Rupee surges 60 paise against dollar following RBI intervention and new measures
- •The Indian rupee appreciated by 60 paise to open at 95.17 against the US dollar compared to its previous close of 95.77 following new RBI measures.
- •The Reserve Bank of India expanded cash deposit requirements for foreign-exchange hedging and tightened rules for non-deliverable derivatives to curb dollar demand.
- •Market experts caution that while these steps provide near-term relief, a sustained recovery depends on crude oil prices and foreign investment flows.
Key Questions Answered
The Reserve Bank of India expanded cash deposit requirements for all foreign-exchange hedging transactions, tightened rules for lenders offering non-deliverable rupee derivatives to clients, and intervened directly in the currency market by selling US dollars to ease pressure on the domestic currency.
Market participants note that the recovery may not signal a sustained turnaround because ongoing pressures such as international crude oil prices, foreign capital investment flows, and the broader trajectory of the US dollar will continue to influence the currency.
Under the revised RBI rules, lenders with units in India's International Financial Services Centre and certain primary dealers can now offer non-deliverable rupee derivatives to non-residents exclusively for hedging purposes rather than for speculative positions.
