From the Financial Times:
...Earlier in the year India appeared relaxed about the rupee, leaving it to appreciate almost 10 per cent against the dollar. That seemed logical. India is far less reliant on exports than most Asian countries, and the stronger currency helped ease inflationary pressures. But the mood is changing as foreign inflows pour into the country’s hot stock market. Foreign exchange reserve accumulation, a rough proxy for intervention, reached $19bn in October. With money supply running ahead of the central bank’s target, it has been keen to sterilise by issuing bills and raising banks’ reserve requirement ratios to 7.5 per cent....More
