Micah Jonah
March 6, 2026
The central bank of India has reportedly deployed about $12 billion to support the country’s currency following market disruptions linked to the ongoing conflict in the Middle East.
According to banking sources, the Reserve Bank of India intervened heavily in foreign exchange markets this week to stabilize the rupee after it fell to a record low of more than 92 per dollar.
Bankers said the intervention ranged between $9 billion and $15 billion, with $12 billion estimated as the median figure used to curb volatility in the currency market.
The pressure on the rupee comes as tensions linked to the conflict involving Iran continue to impact global financial markets and push oil prices higher. Crude prices have reportedly risen by about 16 percent during the week, raising concerns about inflation and economic growth in several countries.
Analysts also noted that the market volatility triggered capital outflows from Indian equities, with foreign investors withdrawing roughly $2 billion from the stock market.
The Reserve Bank of India is believed to have intervened across multiple currency trading platforms, including spot markets, forwards, futures and non deliverable forwards, in an effort to reduce pressure on the rupee.
Bankers familiar with the transactions said the central bank intensified its interventions on Thursday by selling US dollars before the opening of the local currency market, a strategy previously used to influence early market sentiment.
Following the intervention, the rupee strengthened from about 92.10 per dollar to around 91.10 in early trading before later settling near 91.68 per dollar on Friday.
India’s large foreign exchange reserves, estimated at more than $723 billion, are considered a key buffer for the central bank as it seeks to manage currency volatility and maintain stability in the financial system.
