MUMBAI: In a bid to support a falling rupee, which lost as much as 125 paise between October 10 and December 24 when it closed at 85.207, the Reserve Bank on Tuesday said it has net sold $9.28 billion on the spot foreign exchange market in October. The net outstanding forward sale stood at $49.18 billion in October as compared to the net sale of $14.58 billion in September.
The RBI said in the monthly bulletin that it had purchased $27.5 billion and sold $36.78 billion during October. As against this, the central bank has bought a net of $9.64 billion in the spot market in September.
October was the most volatile month for the rupee, with the foreign funds deserting the domestic equities and Donald Trump winning the US presidential polls. On October 10, the rupee was well above 84 (83.95) but it closed at the lowest on Tuesday at 85.207 to the dollar, losing 125 paise in six weeks.
The period saw a massive depletion in the forex reserves—from a life-time high of $704.9 billion to a low of $652.87 billion in the week ending December 13 as the RBI continued to sell dollars to defend rupee. The RBI intervenes in the spot and forwards market to curb exchange rate volatility and over the past a few months, the RBI has been intervening in the forex market to ensure an orderly movement of the rupee.
The central bank made a net outstanding forward sale to the tune of $49.18 billion as of October- end as against a net sale of $14.58 billion at the end of September, show RBI data. The rupee depreciated by 0.3% against the dollar in October and traded in a broad range of 83.79 to 84.0950.