RBI sold a net $35 billion in November and December to curb forex volatility
Reserve Bank of India sold foreign currencies worth $35.4 billion on net basis in November and December to prevent excess volatility in rupee movement amid heightened dollar outflows from local equities as foreign investors started seeking safe haven for their investments after Donald Trump's victory in the US presidential election.
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The RBI sold a net $20.2 billion in November and $15.2 billion in December, data from the central bank's February bulletin showed.
«Our interventions in the forex market focus on smoothening excessive and disruptive volatility rather than targeting any specific exchange rate level or band. The exchange rate of the Indian Rupee is determined by market forces,» Governor Sanjay Malhotra said earlier in the month.
The local currency depreciated by 3.2% against the US dollar since November 6, 2024, the day the presidential election results were announced in the US, largely mirroring the 2.4% appreciation in the dollar index during the same period.
The rupee, like all other major currencies, came under further pressure following Trump's plan to levy reciprocal tariffs on goods from other countries in a structural revision in its trade policy.
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