The Reserve Bank of India is weighing interest rate hikes, currency swaps, and fresh dollar-raising efforts to arrest a rupee that keeps hitting new lows against the greenback.
The rupee fell to an all-time low of 91.7425 against the US dollar, driven by heavy equity outflows and surging demand for bullion imports.
What the RBI is actually doing
The central bank has been quietly deploying foreign exchange swaps at scale. In January 2026, the RBI conducted over $2 billion in FX swaps to inject rupee liquidity into a banking system that was running dry.
That move followed an even larger intervention in December 2025, when the RBI announced a $5 billion USD/INR buy-sell swap auction. The goal: shore up dollar supply in the market without permanently depleting India’s foreign exchange reserves.
