RBI net buys $2.52 billion in January, first purchase in 8 months

RBI turned a net buyer of dollars in January 2026, purchasing $2.52 billion after eight months, even as forward market positions and currency metrics shifted

The Reserve Bank of India (RBI) was a net buyer of US dollars in January, purchasing $2.52 billion in the foreign exchange market, its first net purchase in eight months, according to the central bank’s monthly bulletin. The last time the central bank was a net buyer was in May 2025. 

During the reported month, the RBI bought $27.99 billion, while it sold $25.47 billion. The central bank had net sold $10 billion in December. In the current financial year till January, the central bank net sold $50.78 billion. In 2024-25, the central bank net sold $34.5 billion. 

The outstanding net short dollar position in the rupee forward market rose to $67.77 billion by the end of January, against $62.35 billion by the end of December. 

 

Short positions in less than 1 year fell by around $3 billion, while those in longer than 1-year tenure rose by around $9 billion.

Of the $67 billion net short dollar position, $9.47 billion was in one-month contracts, $7.88 billion in 1-3 month tenures, $10.13 billion position is set to mature between three months and a year, and the remaining $40.27 billion was in more than a year contract. 

The maturity profile of outstanding forwards suggests a shift towards longer-tenor contracts, moving away from a concentration in short-term forwards until January 2025, a report by the State Bank of India said. This helps ease near-term settlement pressures by pushing maturities further out, providing some relief amid rising external shocks, from trade disruptions to geopolitical conflict, although higher swap and hedging costs may offset some of the benefits during periods of volatility, the report said. 

As of February, the real effective exchange rate (REER) of the Indian rupee stood at 94.05, against 94.82 in January. 

The REER adjusts the nominal effective exchange rate (NEER) to account for inflation differentials between India and its major trading partners.