RBI spent ₹2.7 lakh cr to prevent rupee from falling, it still fell to record lows: Report
The Indian rupee has been on a downward spiral in recent months, hitting record lows against the US dollar. Despite the Reserve Bank of India’s (RBI) efforts to intervene and stabilize the currency, the rupee continues to tumble. According to a report by SBI Research, the RBI spent around ₹2.7 lakh crore ($30 billion) to help soften the fall of the Indian rupee over the past few months. However, the central bank’s intervention has not been enough to prevent the rupee from falling to new record lows.
The RBI’s intervention in the foreign exchange market is aimed at preventing excessive volatility in the currency market. The central bank buys or sells US dollars to influence the exchange rate and maintain stability in the market. In the past few months, the RBI has been actively intervening in the market to prevent the rupee from depreciating further. However, despite its best efforts, the rupee has continued to fall, hitting record lows against the US dollar.
According to SBI Research, the RBI has intervened around $18 billion in the forex market during June-September, and an estimated $10 billion in October 2025. This brings the total intervention to around $28 billion, or approximately ₹2.7 lakh crore. The report notes that the RBI’s intervention has helped to slow down the decline of the rupee, but it has not been enough to prevent the currency from falling to new record lows.
The decline of the rupee is attributed to a combination of factors, including a strong US dollar, rising crude oil prices, and a widening trade deficit. The US dollar has been strengthening against most major currencies, including the Indian rupee, due to the Federal Reserve’s monetary policy decisions. The rise in crude oil prices has also put pressure on the rupee, as India is a major importer of oil. The widening trade deficit has further exacerbated the decline of the rupee, as it has led to a surge in imports and a decline in exports.
The RBI’s intervention in the foreign exchange market is a short-term measure to stabilize the currency. However, it is not a long-term solution to the problem. The central bank needs to address the underlying factors that are causing the decline of the rupee, such as the trade deficit and the dependence on oil imports. The government also needs to take steps to boost exports and reduce imports, in order to narrow the trade deficit and support the rupee.
The decline of the rupee has significant implications for the Indian economy. A weak rupee makes imports more expensive, which can lead to higher inflation and higher costs for businesses. It also makes it more difficult for Indian companies to compete in the global market, as their exports become more expensive. The decline of the rupee can also lead to a decline in foreign investment, as investors become wary of investing in a country with a weak currency.
In conclusion, the RBI’s intervention in the foreign exchange market has not been enough to prevent the rupee from falling to new record lows. The central bank needs to address the underlying factors that are causing the decline of the rupee, such as the trade deficit and the dependence on oil imports. The government also needs to take steps to boost exports and reduce imports, in order to narrow the trade deficit and support the rupee. The decline of the rupee has significant implications for the Indian economy, and it is essential that the RBI and the government take urgent action to stabilize the currency and support economic growth.
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