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INR: RBI Deputy Defends FX Stance. 

INR
IndiaEM BulletBulletAPACEmerging Market News

 

  • RBI deputy Patra defended the Central Bank’s defence of the currency.
  • The rupee has declined -1.5% this year, outperforming many of its Asean neighbours several of which have declined over 5%.
  • The RBI is being criticised for using approximately US$30bn of the FX reserves to keep the Rupee stable.
  • The RBI stated in its monthly bulletin that their aim is to insulate the economy from global spillovers and financial stability risks through intervening in the currency to ensure volatility is supressed.
  • India has faced in recent months, significant outflows from its bond and equity markets as foreign investors withdraw.   
  • This puts pressure on the currency leading to the Governor noting on multiple occasions ‘ that India’s reserves are built after meeting all current and capital financing to act as an umbrella for rainy days.’ (as per BBG)
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  • RBI deputy Patra defended the Central Bank’s defence of the currency.
  • The rupee has declined -1.5% this year, outperforming many of its Asean neighbours several of which have declined over 5%.
  • The RBI is being criticised for using approximately US$30bn of the FX reserves to keep the Rupee stable.
  • The RBI stated in its monthly bulletin that their aim is to insulate the economy from global spillovers and financial stability risks through intervening in the currency to ensure volatility is supressed.
  • India has faced in recent months, significant outflows from its bond and equity markets as foreign investors withdraw.   
  • This puts pressure on the currency leading to the Governor noting on multiple occasions ‘ that India’s reserves are built after meeting all current and capital financing to act as an umbrella for rainy days.’ (as per BBG)