SBI Research calls for stronger RBI intervention as rupee slide outpaces fundamentals

SBI Research urges stronger RBI intervention to stabilize the rupee, arguing current depreciation outpaces fundamentals. The report notes the rupee fell to 96.83 per dollar on May 20 after sliding from 90, a pace that saw 152 days elapse to drop 5 per dollar. India’s FX reserves remain ample at about $680 billion, offering room to intervene, though reserves have fallen about $47 billion since late February 2026. Ongoing West Asia risk and sizable foreign portfolio outflows (approx. $22.7 billion) further pressurize the currency. SBI cautions the RBI to maintain policy rates, use available tools, and acknowledge the rupee may be undervalued relative to domestic fundamentals while volatility persists.