Indian rupee rises 1% after central bank measures

The previous closing level was 96.73. The central bank introduced a 20% cash reserve requirement for certain currency derivatives and prohibited the rebooking of cancelled rupee-linked contracts. Market participants also reported likely dollar sales through state-owned banks.

The measures could ease short-term selling pressure on the rupee by raising the cost of currency hedging. However, India's elevated energy import bill and external balance-of-payments risks remain. Analysts stress that a sustained recovery will require improvements in underlying foreign-exchange supply and demand, rather than regulatory measures alone.