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India’s Efforts to Curb the Rupee Are Getting Harder

  • Treasury report includes rare criticism of India FX policy
  • Analysts say RBI may need to go slow on intervention
Urjit Patel, governor of the Reserve Bank of India, has been seeking to curb rupee appreciation.

Urjit Patel, governor of the Reserve Bank of India, has been seeking to curb rupee appreciation.

Dhiraj Singh/Bloomberg
Updated on

India’s currency management just got harder.

The U.S. Treasury said last week it will "closely monitor" the Reserve Bank of India’s policies after a "notable increase in the scale and persistence" of dollar purchases. While it refrained from adding India to its watch list for potential currency manipulators, it noted that foreign-exchange buying had risen to 1.8 percent of gross domestic product in the year through June, just below the Treasury’s 2 percent red line.