RBI uses $73B foreign deposits to steady rupee, spent $7B
Business
The Reserve Bank of India (RBI) has been working overtime to keep the rupee from slipping, thanks to a huge $73 billion inflow of foreign deposits since June.
With this extra cushion, the RBI has moved from occasional interventions to a more steady hand, at one point even spending $7 billion in a single day when things got rough.
Rupee slips 0.8% amid policy tradeoff
These moves have helped calm the rupee's ups and downs, bringing its near-term volatility close to a 10-month low.
Still, the rupee slipped 0.8% against the dollar this quarter as high oil prices and strong demand for dollars from importers put pressure on it.
The RBI now faces a tricky balance between supporting growth and defending the currency's value.