New Delhi, December 17 (IANS). After the Indian Rupee crossed the 91-mark against the Dollar, Foreign Portfolio Investors (FPIs) are playing a big role in the daily fluctuations of the Indian Rupee. This information was given in a report released on Wednesday.
A report by Bank of Baroda (BoB) said that buying and selling by foreign investors, buying or selling of dollars by the Reserve Bank of India (RBI) and changes in the forward market affect the value of the rupee against the dollar.
However, the bank also said that sometimes the RBI interferes in the buying and selling of dollars, due to which there is a slight difference between the figures and the actual effect.
The report said that out of total 11 trading days in December, foreign investors sold more in the stock market in 9 days. The bank says that unless there is an agreement between India and America, the rupee may keep going up and down. This agreement can be done till March 2026.
However, the bank clarified that this effect is sentiment based and not directly linked to the economy.
The bank also said that everyday current account related transactions, such as earnings of IT companies or remittances by people working abroad, and capital related investments such as foreign investments and foreign loans also influence the market. But these are not calculated every day, so it is difficult to directly link them to the daily movement of the rupee.
The report also said that India’s external account is currently in a stable position and the current account is under control. In such a situation, money from foreign portfolio investors can play the most important role in deciding the direction of Rupee. The bank says that the expectation of a possible agreement between India and America is influencing market decisions.
Another recent report by Bank of Baroda said that India’s retail inflation is expected to remain under control in the third quarter of FY 2026. It is estimated that the CPI inflation rate may be around 0.4 percent, which is slightly less than the RBI estimate of 0.6 percent.
The bank said that people have got relief due to softening of prices of food items and stability in prices of other items. However, in recent times there has been a slight increase in the prices of some vegetables.
–IANS
Durgesh Bahadur/ABS
