RBI likely made $30 bn intervention in FX market in Jun-Oct period

The Reserve Bank of India (RBI) is estimated to have intervened nearly $30 billion in the foreign exchange market between June and October this year, according to a report by the State Bank of India (SBI). Of this, around $18 billion was intervened during June–September, with a further $10 billion in October, based on forward market data.

 

This comes even as India’s foreign exchange reserves declined by only $15 billion over the same period, the report said.

 

India’s foreign exchange reserves stood at $703 billion in June 2025 but declined to $687.2 billion in the week ended December 5, as per the latest data released by the RBI. The fall was largely driven by capital outflows and the RBI’s likely intervention to curb excessive volatility in the foreign exchange market. 

 

The central bank’s short dollar forward positions rose to $63 billion by the end of October, according to the latest data. The total dollar short position stood at $59 billion at the end of September.

 

In October, the RBI had been steadily supplying dollars to prevent the rupee from weakening beyond 88.80.

 

After recognising the scale of long speculative positions in the market, the central bank decided to intervene more aggressively, pushing down the spot rate. A large part of this intervention is believed to have taken place in the non-deliverable forward (NDF) market.