Indian cenbank asks lenders to cut speculative bets against rupee, sources say
Indian central bank, in a rare move, instructed some banks to cut their long positions on the dollar-rupee pair on Friday, seeking to reduce speculative bets on the local currency, which is at a record low, four bankers directly familiar with the development told Reuters.
The rupee weakened to a record low of 84.5075 per U.S. dollar earlier in the day, pressured by portfolio outflows and a stronger greenback. Foreign investors have sold a net of $3.1 billion in Indian equities so far in November, after selling a record $11.2 billion in October, putting pressure on the rupee.
On Thursday, after U.S. prosecutors indicted Adani Group's billionaire founder, Gautam Adani, over alleged bribery and fraud, foreign investors sold $600 million. Provisional data suggests selling continued on Friday, with net sales of $150 million.
The group has dismissed the accusations as «baseless».
Amid continued foreign outflows and pressure on the rupee, the Reserve Bank of India's financial market regulations department informally communicated to banks to cut long dollar-rupee positions, the bankers said. The RBI did not immediately respond to an email seeking comment.
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