RBI sold most foreign currency in March to defend falling rupee

The Reserve Bank of India has sold a net $20.1 billion in the spot foreign exchange market in the month of March to support slipping down rupee against the US dollar.

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The INR Indian rupee has hit the lowest level this year to 76.9050 against the USD American dollar.

As evident from the monthly bulletin. The Reserve Bank of India sold a net $20.1 billion in the spot foreign exchange market in the month of March to support the rupee falling against the US dollar.

The central bank said its net outstanding forward dollar purchases have risen  to $65.79 billion at the end of March compared to $49.11 billion as of this February end.

In February , the RBI had sold a net $771 million in the spot market.

The rupee moved in a band of 75.76 to 76.97 in the  month of March.

The rupee has been touching lowest levels in this period is due to various risk versions and strengthened dollar.

Heightened global risks rising from weakening growth. Supply disruptions, elevated inflation  on account of geopolitical agendas. And financial market volatility stemming from synchronized monetary tightening pose near-term challenges”. The the central bank wrote.

The Indian economy’s recovery seems resilient. Although risks arise from global developments have disrupted the momentum. And the increase in international commodity prices is widening the country’s trade and current account deficits.

“In order to achieve a higher growth path on a sustainable basis, private investors need to take higher capital expenditure by the government which crowds in private investment,” RBI