Overview
- The rupee rose for the second straight session on Friday, closing around 95.7 after visible RBI dollar sales and the $5 billion swap announcement provided fresh dollar supply.
- The Reserve Bank of India was a net seller of dollars in fiscal 2026, recording about $53.1 billion of net sales and executing a particularly large net spot sale of roughly $9.8 billion in March.
- The central bank’s forward book swelled to about $103 billion by the end of March, creating binding future dollar commitments that will need to be met regardless of short‑term reserve moves.
- India’s foreign exchange reserves fell to roughly $688.9 billion by the week to May 15 after an $8.1 billion drop in foreign currency assets and valuation effects on gold, and bankers estimate some intervention sales generated about a 10% profit.
- Markets expect volatility to remain elevated because higher crude prices raise India’s import bill and inflation risk, which will constrain policy options and make forward‑book rollovers, exporter dollar conversions, and oil costs key things to watch.