India cbank did not intervene in FX market in August

The RBI has always maintained that it does not target any specific exchange rate.

Written by Agencies | Mumbai | Published:October 10, 2011 6:54 pm

India’s central bank did not buy or sell dollars in the foreign exchange market in August,for the ninth successive month,continuing its hands-off approach,its monthly bulletin showed on Monday.

The Reserve Bank of India (RBI) has always maintained that it does not target any specific exchange rate and only intervenes to prevent excessive volatility in the foreign exchange market.

The RBI had last intervened in November,when it had bought $1.37 billion and sold $500 million,compared with purchases of $450 million in October.

On a net basis,that was the RBI’s biggest monthly intervention since June 2009,when it had bought $1.04 billion.

The rupee moved in a band of 44.19 to 46.08 per dollar in August.

In 2010,the central bank bought a net $1.85 billion, compared with net sales of $5.8 billion in 2009 when it intervened to prevent the rupee from depreciating sharply.

On Monday,the partially convertible rupee ended at 48.975/985 per dollar,after touching a high of 48.895 and stronger from Friday’s close of 49.1550/1650.

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