MUMBAI : RBI Governor Shaktikanta Das said on Friday that due to the RBI actions, including steps to encourage inflows, the movements of the rupee have been relatively smooth and orderly.

Speaking at a meeting, Das said, "By eschewing sudden and volatile shifts, we have made certain that expectations remain anchored and the forex market functions in a stable and liquid manner." He said in recognition of the fact that there is a genuine shortfall of supply of forex reserves in the market relative to demand due to import and debt servicing requirements and portfolio outflows, the RBI has been supplying US dollars to the market to ensure that there is sufficient forex liquidity.

"After all, this is the same reason we accumulated reserves while capital inflows were large." "You also buy an umbrella to use when it rains!" We will continue to monitor the foreign market to ensure that the rupee finds a level that is consistent with its fundamentals. "I want to repeat that we have no specific level in mind for the rupee, but we want to ensure its orderly evolution, and we have zero tolerance for erratic and bumpy swings," Das added.

Recent changes in the currency market have sparked heated debate, with forecasts of the rupee falling to record lows as foreign portfolio funds flee India, according to Das, who addressed the matter.
Das stated that the global monetary policy tightening, the geopolitical scenario, the still rising commodity prices - particularly crude - and the lingering consequences of the pandemic have become overwhelming for all countries worldwide. Even reserve currencies like the Japanese yen, Euro, and British pound sterling have been hit.

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