Amid pressure on the Indian rupee, the Reserve Bank of India’s (RBI) monthly bulletin said the central bank was a net seller of $6.104 billion in the spot foreign exchange market in May. On a gross basis, the RBI purchased $22.229 billion and sold $28.333 billion during the month.
May marked the third consecutive month of net dollar sales by the central bank. The RBI had sold $9.758 billion in the spot foreign exchange market in March and $8.944 billion in April. The rupee strengthened in June, supported by lower international crude oil prices and improved foreign inflows following measures introduced by the government and the RBI.
However, those gains were reversed in July, in line with other major emerging market currencies, amid a strengthening US dollar. In real effective terms, the rupee appreciated in June against its major trading partners, driven by gains in the nominal effective exchange rate and higher domestic inflation.
