Mumbai: The Reserve Bank sold USD 7.7 billion in August to check exchange rate volatility as well as to arrest the decline in value of the rupee against the American currency.The central bank's net sale of US dollars was at USD 7.69 billion in August, nearly three times higher than in the preceding month, according to the data on sale/purchase of US dollars published in the RBI's latest bulletin.
The data also showed that the Reserve Bank did not purchase US dollars in July and August.Reserve Bank's stated position is that it does not target any level or band for the rupee-dollar exchange rate, but intervenes in the forex market only when there is excessive volatility.
In August, the rupee depreciated by 1.6 against the US dollar.The Indian rupee depreciated against the US dollar in September too, amidst elevated trade tensions, heightened global uncertainties, and persistent foreign portfolio investment outflows.
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