Politics · India Bureau
Rupee strengthens on strong foreign currency inflows
The Indian rupee opened firmer against the US dollar following robust inflows through special foreign currency mobilisation schemes. The Reserve Bank of India reported unexpectedly large deposits exceeding $136 billion through these facilities.
LSN India ·
The rupee opened 71 paise stronger at 94.31 against the US dollar on Wednesday, buoyed by substantial foreign currency inflows through special deposit schemes.
The Reserve Bank of India announced that India had attracted $136.38 billion through Foreign Currency Non-Resident (FCNR) and Non-Resident External (NRE) deposit schemes, significantly exceeding market expectations. The central bank mobilised the funds through special rate arrangements designed to encourage overseas Indian deposits during a period of currency volatility.
The stronger inflows reflect growing confidence in India's economic outlook and attractive interest rate differentials offered through the schemes. Such deposits provide the RBI with additional foreign exchange buffers to manage currency movements and support external stability.
Analysts attributed the rupee's opening strength to the positive sentiment generated by the substantial mobilisation, which underscores continued overseas interest in Indian assets despite global economic uncertainties. The inflows are expected to provide the central bank with greater flexibility in managing short-term currency pressures.