The rupee built on the previous day’s gain to open 62 paise stronger on October 13, extending its recovery after the Reserve Bank of India’s (RBI) latest measures to curb pressure on the currency.
The rupee was trading at 95.16 against the US dollar after closing the previous day at 95.77, when it gained over a percent in its biggest single-day gain in more than six months.
The gains came after the RBI on October 12 announced a series of measures to curb dollar demand and speculative activity in the foreign exchange market. It also intervened directly by selling dollars to support the rupee, traders said.
“The RBI will for the present ensure that rupee does not fall beyond 96 levels, with 97 out of question at present. The rupee is likely to trade in a range of 95 to 96 for the day, with exporters to sell the upticks and importers to continue buying the dips hedging their imports payable in October and November,” said Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP.
The central bank reinforced its currency-support measures by widening the scope of its Foreign Exchange Risk Reserve (FERR) requirement and tightening rules governing non-deliverable rupee derivatives offered to non-residents.