Rupee is steadily weakening against the dollar. On June 28, the rupee reached the lowest level ever. At one time on Thursday, the Indian currency was at 69.10 against the dollar. This was the first time that the rupee crossed the level of 69 against the dollar. In such a case, it is necessary for India to take such a step which can save the rupee from falling.
Some market experts says that, the RBI constantly keeps trying to strengthen the rupee against the dollar. Dealers said that the Reserve Bank of India (RBI) has moved to the futures market to stop rupee depreciation. They said that in July, the RBI sold more than 500 dollars in the futures market, thereby contributing to the Indian currency rising from the fall.
The central bank usually intervenes in the spot market to curb the upturn in the currency market. The Treasury Head of a large bank said, “Better options than the Spot Market for the RBI are the futures market.” In addition, next year there are general elections in the country, so the Reserve Bank of India will not want to present a negative picture to the country due to the rupee fall.