RBI Policy
Step in only to curb abnormal volatility in rupee, says Malhotra
This story was originally published at 14:36 IST on 5 December 2025
Register to read our real-time news.Informist, Friday, Dec. 5, 2025
Please click here to read all liners published on this story
--RBI Malhotra: Effort is to reduce to abnormal rupee volatility
--RBI Malhotra: Will continue to reduce excessive volatility in rupee
--RBI Malhotra: Rupee volatility does happen, can happen
--RBI Malhotra on rupee: Stated policy to allow market to determine level
--RBI Malhotra: FX swap liquidity measure, not to support rupee
--RBI Malhotra: Stated policy is don't target any levels for rupee
--RBI Malhotra: We let rupee find its own position
--RBI Gupta: Won't read much into IMF classification of rupee as 'crawl-like'
MUMBAI – The Reserve Bank of India lets the rupee find its own position and only intervenes to reduce abonormal and excessive volatility in the currency market, RBI Governor Sanjay Malhotra said Friday. "These fluctuations, this volatility (in rupee) does happen, can happen," Malhotra said. "Our effort has been always to reduce any abnormal or excessive volatility. And that is what we will continue to endeavor."
His comments come at a time when the rupee has recently declined sharply and has been hitting record lows against the dollar, with the RBI intervening only in a limited manner to prevent depreciation. The rupee fell to a lifetime low of 90.4225 a dollar Thursday amid a prolonged delay in the India-US trade deal and foreign portfolio outflows. So far this year, the Indian unit has depreciated 5.2%.
The governor reiterated that the central bank does not target any particular level for the rupee and only ensures orderly movement. "We don't target any price levels or any bands. We allow the markets to determine the prices," he said. "We believe that the markets in the long run, especially, are very efficient."
Malhotra does not think there has been any conscious attempt to change the central bank's tolerance to volatility. He added that the RBI's step to conduct a dollar-rupee buy-sell swap auction of $5 billion this month was just to support liquidity in the banking system and not to support the rupee.
Talking about the International Monetary Fund's recent reclassification of India's de-facto exchange rate regime as a 'crawl-like' arrangement, from 'stabilised', Deputy Governor Poonam Gupta said, "I would not read much into it." "It's just based on the cross-country comparison of India having this much volatility compared to some other countries," she said. End
US$1 = INR 90.00
Reported by Pratiksha
Edited by Akul Nishant Akhoury
For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.
Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd. by NSE Data & Analytics Ltd., a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt. Ltd.
Informist Media Tel +91 (22) 6985-4000
Send comments to feedback@informistmedia.com
© Informist Media Pvt. Ltd. 2025. All rights reserved.
To read more please subscribe
Share this Story:
