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Mumbai: India's central bank sold a gross $9.9 billion in currency market intervention in July, the highest on record, in a volatile month when the rupee hit a 15-month low but then later rose 1.1 per cent on the dollar.
The central bank's monthly bulletin showed on Friday that the monetary authority sold $6.32 billion on a net basis in July, trimming its net dollar purchases in 2008 to $13.24 billion.
The $9.9 billion gross is the most sold in a month by the Reserve Bank of India (RBI) since it began publishing its currency intervention figures in April 1995. It surpasses record dollar sales of almost $7 billion gross in June.
The Indian currency declined 7.4 per cent in the first seven months of 2008, ending July at 42.57/58 per dollar, in a reversal of its fortunes in 2007 when strong foreign investment inflows drove it to 39.16, its highest in nearly a decade.
This year's fall accelerated sharply in July as crude touched a record above $147 a barrel, the trade deficit widened, and investment outflows weighed.
Traders say that in recent months and days the Indian central bank has continued to support the rupee, which is now at its lowest in two years, has shed nearly four per cent this month alone and lost 13.9 per cent this year.
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