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Foreign exchange operations to be guided by objective of ensuring orderly movements in exchange rate of the Rupee: RBI Annual Report
The Indian rupee experienced bouts of volatility stemming from global financial markets due to the monetary policy stance of the US Fed and lingering geopolitical tensions, the Reserve Bank of India stated in its Annual Report 2023-24. While FPI inflows, softening of crude oil prices and easing of current account deficit supported the INR, a strong USD reflecting safe haven demand in the face of geopolitical tensions and expectations of higher interest rates for longer period in the US imposed downward pressure on the INR. The Reserve Bank intervened in the forex market through operations in the onshore/offshore OTC and exchange traded currency derivatives (ETCDs) segments to maintain orderly market conditions and contain excessive volatility in the exchange rate.