India’s central bank intervenes to stabilize the market, rupee posts biggest single-day gain in over a month

```

On Monday, India's central bank carried out large-scale interventions in the foreign exchange market. Combined with a drop in international oil prices and positive remarks from the central bank governor, this pushed the rupee to its largest single-day gain in over a month.

According to traders familiar with the matter, the Reserve Bank of India (RBI) sold a significant amount of US dollars in the local currency market on Monday, with the intervention scale considered substantial. Boosted by this, the rupee climbed up to 0.8% against the US dollar to 95.7838, marking the biggest single-day increase since June 15.

Meanwhile, RBI Governor Sanjay Malhotra said in an interview with “The Hindu Business Line” that the central bank’s recent series of measures to attract foreign capital has received a strong response from the market. The banking sector has raised a total of $32 billion through channels such as foreign currency deposits. These comments further boosted market sentiment and accelerated the rupee’s rebound.

Rupee Remains Under Pressure This Month, Among Poorest Performers in Asia

According to reports citing sources familiar with the matter, the RBI started selling US dollars when the rupee was trading near 96.15. These individuals requested anonymity.

Dilip Parmar, foreign exchange analyst at HDFC Securities, said, "When the RBI came in, the market already had multiple favorable factors such as falling oil prices, a lower dollar index, and positive remarks from the governor." He added that interventions on trading days with other bullish factors tend to have a more significant effect in boosting the local currency’s exchange rate.

Despite the eye-catching single-day gain, the rupee’s overall performance this month remains weak. Heightened tensions between the US and Iran have driven international oil prices higher, fueling concerns over India’s expanding import bill and continuing to weigh down the rupee. On a monthly basis, the rupee is currently the second worst-performing currency in Asia.

This month’s decline in oil prices was due to easing geopolitical tensions in the Middle East, which objectively provided a favorable window for the central bank’s intervention and made this round of defense action more effective in the market.

Risk warning and disclaimerThe market carries risks and investment requires caution. This article does not constitute personal investment advice and does not consider individual users’ specific investment goals, financial situation, or needs. Users should determine whether any opinions, views, or conclusions in this article are suitable for their particular circumstances. Investing based on this is at your own risk. ```