RBI’s FX intervention makes sense, but is not without costs – ANZ

HomeForex News

RBI’s FX intervention makes sense, but is not without costs – ANZ

USD/INR is now above 83.0, a lifetime high. Economists at ANZ Bank analyze the Reserve Bank of India’s (RBI) perspective on the role of excha

USD/INR is now above 83.0, a lifetime high. Economists at ANZ Bank analyze the Reserve Bank of India’s (RBI) perspective on the role of exchange rate.

RBI’s evolving FX policy is supporting growth and stabilising inflation

Alongside building its FX reserves, the RBI’s evolving FX policy – to keep the Rupee stable and competitive – is supporting growth and stabilising inflation in the face of volatile global economic environment. 

However, even as the RBI is championing the use of the Rupee as a policy tool, its approach may need to shift as the economic environment changes. If its intervention distorts FX markets, they may paradoxically become vulnerable to future shocks.

 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

www.fxstreet.com

COMMENTS

WORDPRESS: 0
DISQUS: