How does rupee strengthen when the Reserve Bank of India sells dollars in the market?



How does rupee strengthen when the Reserve Bank of India sells dollars in the market?..

Answer / Piyush Gupta

When the Reserve Bank of India (RBI) sells dollars in the foreign exchange market, it increases the supply of dollars and decreases the demand for Indian Rupees. This leads to a decrease in the value of the Rupee against the US Dollar, which is equivalent to a strengthening of the Rupee.

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