Suddenly indian rupee Falls to Rs80 against us dollar,how can RBI come to rescue rupee
The depreciation of rupee against dollar incidates that rupee is the weaker currency.
The Reserve Bank of India intervenes in the currency market to support the rupee as a weak domestic unit can increase a country’s import bill . As imports will become cheaper.
There are a variety of methods by which the RBI intervenes. It can intervene directly in the currency market by buying and selling dollars. If RBI wishes to stregthen the rupee value, then it can sell dollar in the market since the RBI has avaiable with different and when it needs to bring down rupee value, it can buy dollars.
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