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Indian rupee holds gains as RBI unveils new dollar-focused measures
USD/INR was down 0.6% to near 95.00, a level not seen in over a month, after the RBI announced a special dollar window for three state-run oil companies.
The Indian rupee extended its gains versus the US dollar on Tuesday after the Reserve Bank of India announced new US dollar-related measures aimed at supporting the domestic currency, FXStreet reports.
In India afternoon trading, the USD/INR pair was down 0.6% to near 95.00, the lowest level in over a month. MUFG said the RBI introduced a broad package that includes a special dollar window to meet dollar requirements for three state-run oil companies, as well as stopping the re-booking of cancelled rupee FX derivative contracts.
MUFG also noted the RBI introduced an FX risk reserve requirement on transactions exceeding $2 million, indicating a more stringent approach to managing currency risk. The report adds that a Reuters report previously described similar tools used by Chinese authorities to discourage one-way bets against the yuan.
The move comes after India’s retail inflation data for September showed consumer price index inflation at 5.54% year on year, higher than expected, according to FXStreet.