CURRENT AFFAIRS

Detailed explanation-1: -The Reserve Bank of India (RBI) released the August 2022 issue of its monthly Bulletin stating that the apex bank turned net seller of the United States (US) currency in June 2022 after it sold USD 3.719 billion on a net basis.

Detailed explanation-2: -How can the RBI sell? USD sell/buy swaps: In order to provide liquidity to the foreign exchange market. The swaps are conducted through the auction route in multiple tranches. The auctions are typically multiple prices based i.e. successful bids will be accepted at their respective quoted premiums.

Detailed explanation-3: -It had bought USD 113.991 billion and sold USD 96.679 billion in the spot market in FY22. In the forward dollar market, the outstanding net purchase at the end of June stood at USD 30.856 billion as compared to USD 49.191 billion in May, the data showed.

Detailed explanation-4: -The RBI sells dollars from its foreign exchange reserves in order to prevent excessive volatility in the rupee. So far this year, the rupee has depreciated 10.17 per cent against the US dollar.

Detailed explanation-5: -RBI continued its dollar-selling intervention to limit the depreciation of the Indian currency against the greenback which has been hurting world currencies since early 2022.