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Mumbai: The Reserve Bank of India Deputy Governor Michael Patra on Friday made it clear in no uncertain terms that the central bank is intervening in the market to defend the rupee against any volatility.

Speaking at an event organised by the PHD chamber, Patra said that RBI is not targeting any level for rupee and will not allow any jerky movement of the currency.

“We are there in the market; we will not allow disorderly movements in the rupee. We have no level in mind, but we will not allow jerky movements," Patra said.

When RBI intervenes in the forex market, it sells dollars and buys rupees to prevent one-way moves in the domestic currency. RBI’s foreign exchange reserves stood at $596.46 billion as on June 10.

According to Patra, the amount of depreciation of the rupee is one of the least in the world.

The rupee has been depreciating against the dollar steadily following aggressive rate hikes by the US Federal Reserve. The rupee had closed at an all-time low of 78.32 against the dollar on 23 June and is down over 5% in 2022.

The Indian rupee has been on a downward spiral due to multiple forces –Foreign Portfolio Investors pulling out, the rising cost of international crude oil prices and a strong dollar. The currency has breached the 78-mark and is expected to touch 80 to the dollar by the end of 2022. Bank of America Securities for instance expects rupee at 81 to the dollar by year-end.

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