FX.co ★ Rupee Steadies Amid RBI Intervention

The Indian rupee stabilized around 94.76 per dollar, halting its decline after touching record lows, as authorities intervened to ease pressure on the currency. In a forceful policy move, the Reserve Bank of India imposed new limits on banks’ foreign-exchange exposure, capping their open positions in the onshore market at $100 million at the end of each trading day, effective April 10. This measure forces lenders to cut back on large FX positions and restricts their capacity to build aggressive, one-sided bets against the rupee. The intervention follows a more than 4% slide in the rupee over the past month, taking it to around 94.82 per dollar. Downward pressure has been intensified by persistent capital outflows, including over $11 billion pulled from Indian equities and a record $1.6 billion in bond outflows in March, further eroding demand for the currency.