How does RBI manage its dollar reserves?
1 Answer(s)
ANKUR
Well, this question is quiet simple, though answer is quiet tough. RBI has to do several activities and regulate several category of persons/ organisations/ institutions via its policies in order to manage forex reserves. You can get some detail by going to following link on RBI website.
http://www.rbi.org.in/scripts/FAQView.aspx?Id=53
RBI has to make sure that it has sufficient foreign currency available in the banking system in order the manage the value of Indian Currency i.e. Indian Rupee. When Imports > Exports FOREX reserves decline, because importers have to pay in forex to outside vendors. and these FOREX can be purchased from authorised banks/ institutions. So RBI and Govt of India has to make sure that EXPORTS should always be > imports by using various policy measures as well.
May 01 2014 07:34 PM
http://www.rbi.org.in/scripts/FAQView.aspx?Id=53
RBI has to make sure that it has sufficient foreign currency available in the banking system in order the manage the value of Indian Currency i.e. Indian Rupee. When Imports > Exports FOREX reserves decline, because importers have to pay in forex to outside vendors. and these FOREX can be purchased from authorised banks/ institutions. So RBI and Govt of India has to make sure that EXPORTS should always be > imports by using various policy measures as well.