The Reserve Bank of India (RBI) sold USD 7.7 billion in August to stabilize the rupee and manage fluctuations in the foreign exchange market. According to the RBI’s latest bulletin on dollar sales and purchases, the central bank’s net dollar sales stood at USD 7.69 billion nearly three times higher than in July.
The data revealed that the RBI did not make any dollar purchases during July and August, highlighting its focus on containing sharp currency movements rather than accumulating reserves.
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While the RBI maintains that it does not aim for any specific level or range for the rupee-dollar exchange rate, it has repeatedly stated that interventions are conducted only to prevent “excessive volatility.”
In August, the rupee weakened by 1.6% against the US dollar. The downward trend continued in September amid ongoing global trade tensions, persistent foreign portfolio outflows, and rising geopolitical uncertainty.
[With PTI Inputs]