What specific RBI measures were announced to support the Indian rupee amid oil-driven pressure?

The RBI announced a discounted forex swap facility for about four months to incentivise external commercial borrowings by public sector undertakings; a similar facility to bear the full hedging cost for banks raising three-to-five year deposits from non-resident Indians through September 30; restoration of the time for firms to remit export proceeds to nine months; and a series of measures to encourage inflows into India's debt market.

How did the rupee respond immediately to the RBI's policy announcement, and what broader context explains its weakness?

The rupee rallied to 95.2450 per U.S. dollar from 95.67 before the policy outcome, and forward premiums on dollar/rupee dropped; this occurred against sustained pressure from a more than 6% year-to-date weakening — making it the second-worst performing Asian currency — driven by the prolonged Iran conflict, surging crude oil prices, foreign investor exits from Indian equities, and India's FX reserves hovering near their lowest level in over a year.

Indian Rupee Rallies on RBI Measures to Support Oil-Hit Currency

Jun 4, 2026

The Reserve Bank of India announced forex swap facilities and tax exemptions to stabilize the rupee, which has weakened over 6% due to surging crude oil prices and Middle East conflicts.

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