The Indian rupee posted its first quarterly fall in four on the last day of the 2020/21 fiscal year as a broad rally in the dollar finally rubbed off on the local unit. "Just as INR's artificial relative uptick in mid-March was transient, we think the sharp relative depreciation is more a reflection of reversal of those transient factors than anything structural at play," said Madhavi Arora, lead economist at Emkay Global Financial Services.
The RBI is examining the impact of the digital rupee on the financial stability in the economy.
Long positions on India's rupee were sharply raised to a three-year high, a Reuters poll found, as the central bank cut back on dollar-buying, while a weaker greenback and encouraging economic recovery signs propped up bullish bets on other Asian currencies. India's economy shrank 23.9% in the three months to June, much more than forecast, pointing to a longer than previously expected recovery, with analysts calling for further stimulus. Long bets on the Chinese yuan, South Korea's won, Singapore's dollar and the Malaysian ringgit were all raised to their highest since early 2018.