Reserve Bank of India intervenes as rupee drops over 7%
The Indian rupee has dropped over 7% this year, recently touching 96.96 to the US dollar.
To stop it from slipping further, the Reserve Bank of India (RBI) is rolling out new measures aimed at calming the currency market and easing pressure on the rupee.
RBI opens dollar window, tightens forex
RBI just opened a special dollar window for public oil companies to lower market demand for US dollars.
It is also tightening rules on currency trading by reducing derivative limits and asking banks to keep more reserves if they are dealing with big foreign exchange trades.
Plus, starting October 16, banks will need to hold more cash daily, part of a broader effort that includes selling government securities to soak up extra money in the system.
All these moves are meant to help keep the rupee from crossing that crucial 97 mark to the US dollar.