Archive · 18 Aug 2026
Rupee tumbles as RBI advances FCNR(B) swap closure
The rupee is India's money.
It became weaker against the US dollar on Monday.
This happened because the Reserve Bank of India, the country's central bank, closed a special program earlier than planned.
That program helped banks bring in foreign money.
At the same time, the price of oil went up, which also hurt the rupee.
The rupee fell a little, but the central bank stepped in to stop it from falling too much.
Some experts think the central bank made a confusing choice.
Others think it was a smart move because the program already brought in enough money.
The rupee is expected to stay around 95 to 96 per dollar for now.
Experts think it might get stronger later this year.
The RBI advanced the closure of its concessional FCNR(B) swap facility to August 31 from September 30.
The rupee depreciated 0.2% to close at a 17-day low of 95.61 against the dollar, the worst-performing Asian currency.
Crude oil prices rose to nearly $90 a barrel, adding pressure on the currency.
Jamal Mecklai criticized the RBI for sending confused signals, while Ananth Narayan called the early closure prudent.
Analysts expect the dollar-rupee to hold a 95-96 range, with gradual appreciation toward 94 over the fiscal year.
- Who
- The Reserve Bank of India (RBI), currency expert Jamal Mecklai, former Sebi member Ananth Narayan, and economists from IDFC FIRST Bank and Kotak Securities.
- What
- The rupee depreciated 0.2% to a 17-day low of 95.61 per dollar after the RBI closed its FCNR(B) swap facility early.
- When
- Monday, with the FCNR(B) deadline advanced to August 31 from September 30.
- Where
- India's foreign exchange and government securities markets.
- Why
- The RBI's premature closure of the concessional swap scheme and a rise in crude oil prices to nearly $90 a barrel.
Critics of early closure
Supporters of early closure
Timing of FCNR(B) window closure
Critics of early closure
Jamal Mecklai says the premature closure sends confused signals after the RBI said the scheme would run its course, hurting the central bank's credibility.
Supporters of early closure
Ananth Narayan says the scheme achieved its objective faster than anticipated and closing it was prudent given the cost of subsidised swaps.
Rupee outlook
Critics of early closure
Mecklai says the REER is supremely undervalued and structural issues need government action.
Supporters of early closure
Gaura Sengupta and Anindya Banerjee expect the RBI to contain pressure, with gradual appreciation toward 94 over the fiscal year.
- Rupee close
- 95.61 per US dollar
- Daily change
- -0.2%, worst in Asia
- FCNR(B) deadline
- August 31 (advanced from September 30)
- Crude oil price
- Nearly $90 per barrel
- 10-year bond yield
- 6.79% (up 5 basis points)
- 5-year bond yield
- 6.41% (up 8 basis points)
- Rupee all-time low
- 96.96 on May 20
- Expected FCNR(B) inflows
- About $70 billion by end of month
