finance
RBI Sells Dollars to Stabilize Rupee Amid Gulf Conflict and Rising Oil Prices
The Reserve Bank of India has implemented multiple measures to stabilize the rupee since the Iran war began on February 28, 2026. Corporate India faces incremental costs of Rs 20,000 crore to Rs 40,000 crore over six months amid elevated oil prices. Feeble signs of de-escalation emerge as backchannel talks resume between the United States and Iran.
MA
indiatoday.intoday.inAudio version
Tap play to generate a narrated version.
Developing·Limited corroboration so far. This page will refresh as more sources emerge.
The Reserve Bank of India has intervened heavily in the spot market by selling dollars since February 28, 2026, when the Iran war began, to prevent a sharp depreciation spiral of the rupee. 5 band as of April 24, 2026. Feeble signs of de-escalation are emerging from the Gulf conflict as of April 24, 2026, with backchannel engagements between the United States and Iran resuming.
The Indian crude oil basket spiked beyond $150 per barrel at the peak of energy supply disruption and is hovering around $105 to $110 per barrel as of April 24, 2026. The RBI forced the unwinding of an estimated $30 billion to $40 billion of arbitrage positions between offshore and onshore markets through March and early April 2026.
The RBI tightened banks’ open currency positions and restricted corporates from rebooking cancelled forward contracts. 6 lakh crore in January 2026 but was steadily absorbed, bringing conditions close to neutral by mid-April 2026. Short-term funding costs hardened by 35 to 60 basis points.
One-year hedging premiums rose by 40 to 75 basis points at peak stress. India’s top 100 corporates manage foreign exchange exposure of over Rs 20 lakh crore to Rs 22 lakh crore. Historically, 35-45 per cent of India’s top 100 corporates' foreign exchange exposure is hedged, but hedge ratios have increased by 8-12 percentage points since March 2026.
On peak days, offshore participation surged to $3 billion to $4 billion. Corporate India is absorbing Rs 20,000 crore to Rs 40,000 crore of incremental costs over a six-month period. 5 lakh crore in annual profits.
