Exchange Rate

Trump’s tariffs have made Asian central banks’ jobs complicated amid a brewing currency war.

Tariffs make dollar supreme, India’s choices more difficult than ever

Amid tariffs, the RBI will need to choose a battle it can win: either exchange rate or domestic inflation

Does the REER reflect RBI's overprotectiveness towards the rupee?

The RBI’s interventions have been criticized and have found support too

How much is too much in RBI’s forex market intervention?

Central bank interventions tend to distort market price but that is a cost worth taking sometimes

Chart of the Day: REER shows a stable rupee is not necessarily at fair value

The RBI’s interventions are keeping the rupee in a tight band, but not avoiding overvaluation

Trump’s trade war threat against China signals a bumpy ride for India’s exchange rate

Trump’s trade policies would make Asian economies get into a currency war soon and the Indian rupee won’t be able to avoid it.

India, Russia mull direct rupee-ruble FX rate to boost bilateral trade

The idea involves avoiding pegging the exchange rate with the dollar or any other third currency. However, the official says that in order to establish a direct FX rate, the rupee and ruble would need to trade in the same currency exchange platform for a much larger quantity and for a longer duration while the two sides workout a mutual referencing price.

Short-term pressure on rupee unlikely to affect exports: Experts

The domestic currency's depreciation has been less than what has been seen for competing currencies like the Vietnamese dong and Indonesian rupiah, tempering the country's competitiveness in overseas markets.

RBI should limit intervention in forex market, says D Subbarao

On the foreign exchange reserve front, the former RBI governor said holding reserves is a safety net, but also involves cost.

Can’t isolate impact of rupee fall on India’s imports, exports: Fin Min in Parliament

Chaudhary's comments come after the rupee hit a new all-time low of 83.41 per dollar on December 13. Since then, the Indian currency has gained some ground and was even trading in the sub-83 per dollar territory early on December 18

Why is the Indian rupee a grinch in a Christmassy market?

The RBI has been a player on both sides of the market and intervening as a seller and buyer depending on the situation. That said, the bias has been to soak up inflows into domestic markets, preventing an appreciation of the rupee.

Bangladesh: An economic disaster, not just a forex crisis, is in the making

When competitors report a sharp decline in specific garment exports, shipments of those from Bangladesh grew in July-August. From $48 billion in 2021, forex reserves are a lowly $21 billion. A $12 billion gap between shipment values and export receipts suggests corruption or data fudging. Exchange rate mishandling has dented the trust of migrant workers and their foreign remittances

After August pull-back, RBI net sold $10 billion in September

In July, the RBI had sold a record $38.77 billion in gross terms as the Indian rupee breached the 80-per-dollar mark for the first time on July 19

After record-breaking July, RBI's gross FX sales fell to $23 billion in August

On a net basis, the RBI had sold $19.05 billion in July, with data released today showing this number fell to $4.25 billion in August

RBI’s endgame for rupee must be a win for credibility

Managing the incidental outcomes of exchange rate policy on its interest rate policy and the economy will help the Reserve Bank of India maintain its credibility.

Decadal low forward dollar premiums could be slow to rise back

Expectations that the RBI won’t need to match up the intensity of the US Fed in rate hikes have strengthened the view that the interest rate differential is set to narrow further in the coming months. A narrowing interest rate differential reduces the benefit of buying dollars in the future.

Interview: RBI needs to ease off forex intervention, says Standard Chartered’s Sahay

A weak currency could complicate the inflation outlook but the RBI is rightly focused on curbing inflation through rate hikes, says Anubhuti Sahay, who believes that the latest data on gross domestic product growth won’t sway the central bank towards a pause

Chart of the Day: RBI’s big short in forex

The Reserve Bank of India's net forward position dropped by a massive $18 billion in June as the central bank went short on the dollar in the 1-month segment.

Chart of the Day: The rupee-rouble trade is growing

India’s imports from Russia outstrip exports and the trade deficit with the country has increased over the past two years. As of March, the trade deficit has more than doubled.

RBI measures unlikely to open forex floodgates, may not stop rupee slide: Experts

The central bank announced measures on July 6 to boost foreign exchange inflows and alleviate pressure on the rupee’s exchange rate

RBI's FX measures to impact flows positively, says Economic Affairs Secretary Ajay Seth

Seth called the measures announced by the RBI as massive and said they were already having some impact on the exchange rate.

Central banks in Asia wedged between rate hikes and currency wars

The US Fed's fast-paced policy tightening has made it hard for Asian central banks to choose between hiking policy rates to stem capital outflows and inflation and let their exchange rates depreciate to support the still fragile economic recovery.

Chart of the Day: RBI's forex intervention leans heavily on forwards

The RBI has done sell/buy swaps in March and April to elongate the tenure of its forward contracts. The central bank turned a net buyer of dollars in the spot forex market, as per data.

Chart of Day: Forex reserves are no vibranium shield against Fed tightening

Dollar outflows have intensified in the wake of the US Fed's unprecedented pace of tightening, which is reflected in the sharp fall in forex reserves of India as they get depleted.

Rupee at 80 for a dollar: This derivative sets a one-year time frame

If offshore NDF rates for the dollar/rupee pair are to be believed, the Indian currency is expected to weaken closer to 79 to its US counterpart in three months. What’s more is that the rupee could touch a low of 80 per dollar in a year’s time