Rupee hits a fresh intra-day low, cuts
losses as RBI intervenes
hit a fresh intra-day low on Thursday as it breached the 77.5/$ mark on the
back of strengthening of the US dollar, before intervention from the Reserve
Bank of India (RBI) helped cut its losses.
rupee ended the day at 77.43/$, before touching a low of 77.63/$, losing 18
paise or 0.24 per cent from its previous close of 77.24/$.
fell to a fresh all-time low today (Thursday) as the dollar continued to
strengthen. But losses remained restricted as the RBI intervened to curtail
volatility of the currency. Dollar strengthened after inflation in the US rose
in April, said Gaurang Somaiya, Forex & Bullion Analyst, Motilal Oswal
had hit an all-time closing low on May 5 when it hit 77.47/$.
came under pressure as investors pulled out from riskier assets following the
global uncertainty caused by the prolonged Russia-Ukraine war. The currency has
depreciated 2.1 per cent against the dollar in FY23 so far and depreciated 4
per cent in 2022.
central bank has beefed up its intervention across foreign exchange market
spot, futures and off-shore to slow the fall in rupee. As a result, the
foreign exchange reserves fell by $45 billion since September 2021.
spot touched a fresh all-time high after higher-than-expected inflation print
in the US pushed US dollar Index to a fresh 20-year high, said Anindya
Banerjee, VP, Currency Derivatives & Interest Rate Derivatives at Kotak
in equities was an add-on force for the US dollar. We suspect the RBI might
have sold dollars to stem the decline in the rupee. Overall view is of a range,
between 77.2 and 78.2 on spot, Banerjee said.
forex reserves have fallen below $600 billion, and the market expects reserves
to go down further before it increases. Total foreign exchange reserves were at
$597.7 billion for the week ended April 29.
the half yearly report on management of foreign exchange reserves, released on
Thursday, the RBI has said its net forward assets stood at $65.79 billion as at
the end of March 2022.
RBI has increased its gold reserves over the last two years by over 100 metric
tonnes, the report on management of foreign reserve said.
at end-March 2022, the RBI held 760.42 tonnes of gold, as compared to 653.01
tonnes same time in 2020, while in 2021 the amount was 695.31 metric tonnes.
value of gold reserves increased to $42.7 billion as of March 2022, from $30.9
billion two years back.
report noted that at the end of December 2021, foreign exchange reserves cover
of imports (on balance of payments basis) declined to 13.1 months from 14.6
months at end-September 2021. The country has foreign exchange reserves of $633
billion as on December 31.
ratio of short-term debt (original maturity) to reserves, which was 16.5 per
cent at end-September 2021, increased to 18.1 per cent at end-December 2021,
the report said. The ratio of volatile capital flows (including cumulative
portfolio inflows and outstanding short-term debt) to reserves increased from
64.1 per cent at end-September 2021 to 65.0 per cent at end-December 2021.