RBI's $73 bn short book is weighing on Indian rupee

The potential dollar purchases may lead to the rupee falling to 86.50 per dollar by end-Dec, says IDFC First Bank

- Bloomberg

The Indian rupee is emerging as Asia's worst performer this quarter and may continue to lag peers as the central bank aims to avert a depletion in its foreign-exchange reserves, according to analysts.

Having already pledged to sell billions of dollars via derivatives contracts at various points in the future, the Reserve Bank of India (RBI) is expected to buy up sizeable amounts of the US currency to prevent its holdings from running down. Those purchases are seen putting pressure on the rupee.