The rupee opened sharply stronger at 93.58 after the RBI capped banks’ gross onshore FX positions at $100 million, forcing them to unwind large exposures by April 10. However, the currency later weakened to around 94.45 as dollar demand from importers and corporates picked up. The move aims to curb arbitrage between onshore and NDF markets. While banks may face some losses from position unwinding, narrowing rate gaps could limit the overall impact.
