INSUBCONTINENT EXCLUSIVE:
The rupee on Wednesday rose, reflecting gains in other emerging-market Asian currenciesThe Reserve Bank of India appears to have moved away
from its hands-off exchange rate strategy as the rupee plumbed fresh lows earlier this month.The country's foreign-exchange reserves
plunged $5.14 billion in the week ended Oct
12, the biggest drop in seven years, hinting the central bank intervened to stem the rupee's losses from getting out of hand after it held
5 meeting.While it may be too early to conclude that the RBI will step in frequently to defend the rupee on such a magnitude regularly, the
intervention along with a fall in oil prices helped steady the currency, according to analysts at Natwest Markets Plc and Standard Chartered
Plc."This reserve selling was mostly due to USD/INR buying pressure after the FX market reacted negatively to the RBI decision," said
Maximillian Lin, an emerging-markets Asia strategist at NatWest in Singapore
The intervention helped limit further weakness in the rupee, a move helped by a decline in oil prices and a softer dollar, he said.The rupee
lost more than one percent in three sessions after the RBI's rate decision, sinking to a record 74.4825 on Oct
Asia's worst-performing currency then recovered to advance over the past two weeks, though ING Bank NV has said the bounce will soon give
way to another round of declines."The strong intervention appears to be aimed at containing the losses post the RBI policy, and they may
also have been worried about this spilling into the equity market," said Gopikrishnan MS, head of foreign exchange, rates and credit for
South Asia at Standard Chartered in Mumbai.The rupee on Wednesday rose, reflecting gains in other emerging-market Asian currencies, gaining
0.4 percent to 73.28 as of 9:13 a.m
in Mumbai, halting two days of declines.
