The Reserve Bank of India Thursday introduced new measures to prop up the Indian rupee after the currency fell to a near six-month low, dpa quoted officials as saying. Exporters were told to convert 50 per cent of their foreign exchange earnings into rupees within two weeks, the central bank said in a notification posted on its website. It said that exporters would be permitted to purchase foreign exchange only after using all of the foreign currency balances in their accounts. The Reserve Bank of India also told banks to restrict their net intraday open positions to further stem speculation in the markets, broadcaster NDTV reported. Traders expect the measures to have a short-term positive impact on the rupee as it could lead to an estimated 2.5 billion to 3 billion dollars in dollar inflows from exporters. The rupee fell to 53.83 against the US dollar on Wednesday. Its all-time low is 54.30, which was reached on December 15. The currency has declined almost by 20 per cent since August. The rupee steadied slightly after the bank's move, rising to 53.24 against the dollar in early trade on Thursday. But the long-term view on the rupee remains predominantly bearish, NDTV reported. Brokerages like CLSA and UBS said they still expected it to weaken to levels near 56-57 to the dollar, saying fundamental and global factors such as the eurozone crisis, would contribute to its downward slide.
