Mumbai, December 5: The Reserve Bank of India (RBI) is actively employing its foreign exchange (forex) reserves to curb currency volatility amid persistent dollar outflows, according to a report by Union Bank of India.
India’s forex reserves have declined significantly from their peak of USD 705 billion to USD 656.58 billion as of November 22, 2024. The report attributes this decline to the central bank’s efforts to stabilize the rupee, which has been under pressure due to sustained foreign portfolio investor (FPI) outflows from the equity market.
“Persistent FPIs outflows from the equity market have led the rupee to depreciate to record lows. However, our central bank is likely curtailing volatility through utilization of forex reserves,” the report noted.
The report highlights the proactive steps taken by the RBI to manage liquidity, maintain currency stability, and address fiscal challenges amid global economic volatility. Despite these measures, the rupee remains under pressure, reflecting the complex interplay of external factors like dollar strength and domestic fiscal constraints.
As the rupee hovers near record lows, the RBI’s strategies, including the judicious use of forex reserves and liquidity injections, underscore its commitment to economic stability. However, the challenges remain significant, with global uncertainties and domestic fiscal issues requiring continuous attention.
India’s economic framework faces a critical juncture, with the central bank’s interventions playing a pivotal role in shaping the trajectory of growth and stability.
December 23, 2024: Sam Konstas' rise to the Australian national team is a compelling story…
Libra (September 23 – October 22): The year 2025 is one of balance, growth, and…
Congress Leader Calls GST System Overly Complex, Highlights Loopholes and Compliance Issues New Delhi, December…
December 23, 2024: The ICC Champions Trophy 2025 is set to be a major event,…
With temperatures plummeting to a bone-chilling -7°C, Dal Lake partially freezes while residents brace for…
December 23, 2024: In a truly heartwarming moment, Taylor Swift surprised a teenage fan named…