RBI asks exporters to convert 50% of forex into rupees
Following are some of the expert comments after the Reserve Bank of India (RBI) made a dramatic move to prop up its battered currency today, requiring exporters to sell half the foreign currency in their accounts, which helped to strengthen the rupee in morning trade.
Subramanian Sharma, Director, Greenback Forex, Mumbai
"RBI's move to make exporters convert 50% of their existing foreign currency earnings into rupee balances is a significant move, will result in large near-term inflows.
"However, pent up dollar demand exists and the USD/INR will trade in 52-53.80 band in near term."
Radhika Rao, economist, Forecast PTE, Singapore
"Steps to force exporters to convert at least half of the earnings into rupee accounts will improve dollar supply at home and ease downward pressure on rupee.
"The RBI is not alone in taking such measures, as we recollect that Indonesia had imposed similar regulations last year, forcing exporters to retain earnings onshore.
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