RBI buys dollars to halt rupee rise

The Reserve Bank of India (RBI) intervened in the foreign exchange market to halt the rupee’s upward march in the last 10 trading days. The rupee was under severe pressure on Tuesday as the RBI mopped up around $250 to $300 million to prevent the rupee to touch the psychological 46-mark.

On Monday, the rupee was even traded at 46.0075 for a brief period. The rupee finally closed the day at 46.14/15 per dollar, losing 10 paise in a single trading day from the overnight level of 46.04/05. The underlying rupee sentiment, however, is positive.