RBI becomes net purchaser of US dollars in April

The Reserve Bank of India became a net purchaser of US dollars in the first month of current fiscal after it net bought USD 5.431 billion from the spot market.
The central bank bought USD 9.756 billion from the market and sold USD 4.325 billion in April, according to the RBI's monthly bulletin released today.
In the year ago period, RBI was also a net purchaser of the US currency after it bought USD 7.850 billion and sold USD 1.980 billion from the spot market.
In 2014-15, the central bank had net purchased USD 56.882 billion. It had bought USD 126.604 billion and sold USD 69.772 billion in the previous fiscal.

The central bank's intervention in the foreign exchange market is aimed at curbing volatility in the currency market.
While speaking to reporters after the announcement of the second bi-monthly monetary policy on June 2, RBI Governor Raghuram Rajan had said, "Where we sort of move in or intervene, is when we find strong flows going in or going out, in such a way that we think the rupee departs significantly, there is significant movement.
"We do not quite know where fundamentals are, but there is significant movement one way or the other, and we believe that is temporary and not likely to be sustained. So to reduce volatility we intervene in the market."

In the forwards dollar market, the outstanding net forward purchase at the end of April stood at USD 5.172 billion as against purchase of USD 8.322 billion as of end March.