RBI Sells $11.9 Billion to Support Rupee Amid Pressure

New Delhi: The Reserve Bank of India (RBI) has sold a net $11.9 billion in October 2025 to stabilize the rupee, highlighting its pivotal role in maintaining currency market stability. According to the RBI’s December bulletin, the central bank has been actively managing both spot and forward markets throughout FY25 to curb rupee volatility and maintain orderly market conditions.

In the over-the-counter (OTC) spot market, the RBI sold more dollars than it purchased to provide liquidity support. Dollar purchases in October surged by 704% to $17.7 billion from $2.2 billion in September, while total sales rose 192% to $29.6 billion. This resulted in net dollar sales of $11.9 billion, up 50% from $7.9 billion in September. Overall, net dollar sales for FY25 up to October totaled $34.5 billion, equivalent to ₹2,91,233 crore at the contract rate.

Forward Contracts as a Strategic Tool
Alongside spot market interventions, the RBI also used forward contracts to influence market expectations without immediately impacting foreign exchange reserves. By the end of October, net forward sales increased 7.1% to $63.6 billion from $59.4 billion in September, providing a buffer that reassured markets of future dollar availability if needed.

Neutral Position in Futures Market
In exchange-traded currency futures, the RBI maintained a neutral net position, buying and selling $2.3 billion each in October. Despite this, trading volumes surged 73.5% compared to September. Net futures sales declined 9.8% to $1.4 billion by the end of the month.

Efforts to Protect the Rupee
Data indicates that the RBI intervened to prevent the rupee from falling below 89 against the dollar. The effective intervention price in October was around ₹88.25 per dollar, slightly below September’s ₹88.35, even as dollar sales increased significantly.

Rupee Movement Against the Dollar
On Monday, the rupee weakened slightly against the US dollar. After three days of gains, it failed to break the 90 mark, pressured by corporate dollar demand and non-deliverable forward (NDF) markets. The rupee closed at 89.65, down 0.4% from Friday’s 89.27, trading between 89.45 and 89.72 during the day.

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