Official explanation: The rupee continues to depreciate due to market concerns about the Indian economy. At present, India is suffering from a huge budget and trade deficit, and it also lacks economic reform. The central bank of India stipulates that local exporters must convert 50% of onshore foreign exchange into rupees within 15 days, in order to curb the continuous decline of the rupee. The huge calculation deficit of Indian government comes from the failure of welfare expenditure and tax increase, while the trade deficit is caused by the slowdown of Indian export growth caused by the decline of demand in Europe and America, while the increase of oil price has widened the deficit gap and triggered inflation.

Last month, Standard & Poor's rating agency warned that if the Indian government could not take effective measures to control its budget and trade deficit, Standard & Poor's might reduce India's foreign exchange bonds to junk status in the next two years.

The Bank of India said that the policy of allowing exporters to convert half of their foreign exchange into rupees shows how overwhelmed the Bank of India is now. "The Bank of India has exhausted its tricks and has now turned to fine-tuning the currency. But this can play a role of correction at most and will not save the rupee in the bull market. "

According to market estimates, the scale of measures taken by the Bank of India to allow exporters to exchange foreign exchange may be around $7 billion.

In recent years, the US dollar has generally been exchanged for more than 40 rupees, and recently it has been more than 50 rupees. The intervention of the Bank of India in the market for two weeks in a row still cannot stop the rapid decline of the rupee. Although the Bank of India has a foreign exchange reserve of $300 billion, compared with the foreign trade deficit of $654.38+085 billion, its ammunition is limited.

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