Why Is The Rupee Falling? RBI’s Dollar Defence And The Risks To Forex Reserves Explained

The Indian rupee is under pressure from elevated crude oil prices, foreign investor outflows and a stronger US dollar. The Reserve Bank of India has stepped in with dollar sales, a special dollar facility for three state-run oil companies and tighter foreign-exchange derivative rules. But these interventions raise questions about the sustainability of the currency defence. Reuters reported that economists estimate the RBI deployed around $75–80 billion through spot dollar sales and currency swaps since June. India Today TV’s Akshita Nandagopal explains why the rupee is weakening, how the RBI is responding and the risks to India’s foreign exchange reserves.