RBI Intervention Sparks Rupee’s Biggest Gain in 7 Months

The Reserve Bank of India (RBI) finally stepped in with some serious muscle on Wednesday, dragging the rupee back from the brink of a total freefall. And then, after hitting a terrifying all-time low of 91.14 just a day ago, the domestic currency posted its biggest single-day gain in seven months.

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The thing is, the RBI had been relatively quiet while the rupee slid past 90, but Wednesday was a different story. State-run banks were spotted selling dollars aggressively on behalf of the central bank, which essentially forced the rupee to snap back.

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The Great Recovery

The numbers from Wednesday morning were a rollercoaster. Here’s the kicker: after opening at a weak 91.07, the rupee surged to an intraday high of 89.75 before settling around the 90.09 mark.

• Percentage Gain: A massive 1.03% recovery—the strongest move since May 2025.

• Liquidity Injections: This wasn’t just about selling dollars. The RBI also infused ₹45,000 crore into the system via a currency swap on Tuesday and is prepping another ₹50,000 crore bond purchase for Thursday to keep the banking system from drying up.

• The Dollar Context: It helped that the US dollar index was actually hovering near its lowest point since October, as cooling US labor data has investors betting on more Fed rate cuts soon.

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Is the Pain Over?

Let’s be real—most analysts think this is a temporary breather rather than a full reversal. The ongoing stalemate in India-US trade talks and the relentless exit of foreign portfolio investors (FPIs) are still huge weights around the rupee’s neck.

As treasury experts noted, the RBI has essentially “created shorts” and will eventually need to buy those dollars back, which could slowly nudge the rate back toward the 91 level in the coming weeks. It’s an ongoing tug-of-war between the central bank’s intervention and the market’s fear, or nothing.

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