Rupee falls to 95.54 per dollar amid month-end dollar buying
The Indian rupee dropped to 95.54 per US dollar on Thursday, giving up earlier gains as importers and traders rushed to buy US dollars at the end of the month.
This came just after a strong rise earlier in the week when oil prices dipped below $90 per barrel.
RBI allows more frequent dollar swaps
A mix of month-end dollar demand, traders covering their positions, and a slight uptick in the US dollar index all played a part, according to Dilip Parmar, a currency research analyst at HDFC Securities.
The Reserve Bank of India (RBI) stepped in by letting banks swap US dollars more flexibly, hoping to keep things steady as big foreign currency deposits flow through before Monday's deadline.
Even with weak oil prices and some market jitters after a midweek bank holiday, the RBI told banks they could swap dollars raised from these deposits more than once a week, giving them flexibility to handle large inflows before the subsidized deposit scheme ends.