Rupee Holds Steady Amid Oil Price Surge Thanks to RBI Support

New Delhi [India], August 2 (ANI): The Reserve Bank of India's proactive measures and capital inflows helped limit the Indian rupee's decline in July, despite a 20% surge in global crude oil prices.

A report from Bank of Baroda noted that the rupee depreciated by only 0.8% in July, supported by a weaker US dollar, strong foreign capital inflows, and RBI intervention in the foreign exchange market.

The report attributed the rupee's resilience to higher foreign portfolio investment (FPI) inflows, which rose to a 22-month high driven by stronger equity investments. The RBI also attracted USD 40.8 billion in inflows through its special measures, while FPI inflows reached USD 4.2 billion during the month.

The Bank of Baroda report said that a decline in the US Dollar Index (DXY) by 1.3% during July provided additional support to the rupee. Despite the higher crude oil prices weighing on the domestic currency, the RBI's measures and capital inflows helped limit further weakness in the rupee.