RBI net absorbed $561 million in June as inflows picked up
In June, the Reserve Bank of India engaged in net purchases of $561 million from foreign exchange markets, showcasing its response to significant capital inflows into India. Following its dollar sales in April and May to stabilize the rupee, the c...
By Reuters |
PTI
The Reserve Bank of India bought a net $561 million in the foreign exchange market in June, data released on Tuesday showed, reflecting the impact of likely interventions, swap maturities and absorption of capital inflows.
The RBI said in its monthly bulletin that it purchased $30.89 billion and sold $30.33 billion in June.
The central bank had sold a net $6 billion in May, which had been preceded by a net sale of $8.9 billion in April.
The Indian rupee declined to a record low of 96.96 per dollar in May, pummeled by surging oil prices due to the Middle East conflict, but has since been steadied by a deluge of capital inflows under RBI policy measures announced in early June.
The central bank between June 8 and August 21 garnered nearly $73 billion worth of inflows, with a bulk of it from a zero-cost hedging facility for banks' overseas FX deposits.
Analysts have said that the RBI has likely used a part of the inflows to pare down the size of its forward dollar liabilities alongside interventions in the FX market to support the rupee.
The RBI's net outstanding forward dollar sales stood at$103.3 billion as of end-June, compared with $106.7 billion at the end of May.
The data also showed that the central bank's gold holdings have remained unchanged since May 22 at 880.52 metric tonnes.
On Tuesday, the rupee closed 0.35% higher at 95.4125 per dollar, supported by a pullback in oil prices, after the currency spent much of the session in a narrow range as central bank intervention kept a firm lid on losses.
The RBI said in its monthly bulletin that it purchased $30.89 billion and sold $30.33 billion in June.
The central bank had sold a net $6 billion in May, which had been preceded by a net sale of $8.9 billion in April.
The Indian rupee declined to a record low of 96.96 per dollar in May, pummeled by surging oil prices due to the Middle East conflict, but has since been steadied by a deluge of capital inflows under RBI policy measures announced in early June.
The central bank between June 8 and August 21 garnered nearly $73 billion worth of inflows, with a bulk of it from a zero-cost hedging facility for banks' overseas FX deposits.
Analysts have said that the RBI has likely used a part of the inflows to pare down the size of its forward dollar liabilities alongside interventions in the FX market to support the rupee.
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The RBI's net outstanding forward dollar sales stood at$103.3 billion as of end-June, compared with $106.7 billion at the end of May.
The data also showed that the central bank's gold holdings have remained unchanged since May 22 at 880.52 metric tonnes.
On Tuesday, the rupee closed 0.35% higher at 95.4125 per dollar, supported by a pullback in oil prices, after the currency spent much of the session in a narrow range as central bank intervention kept a firm lid on losses.
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