Amid continued pressure on the rupee, the Reserve Bank of India (RBI) remained a net seller of US dollars for the second straight month in August, offloading $7.6 billion compared with $2.5 billion in July.

Data from the central bank shows that during the current financial year (2025–26), the RBI has been a net buyer of the greenback only once — in May — while turning net seller in April, June, July, and August, Business Standard reported.

The move reflects the RBI’s continued intervention in the currency market to stabilise the rupee amid volatility driven by global factors.

The outstanding net short-dollar position in the rupee forward market declined further to $53.35 billion by the end of August, down from $57.85 billion a month earlier, indicating a reduction in the central bank’s forward dollar commitments.

Meanwhile, the real effective exchange rate (REER) of the Indian rupee weakened further to 97.6 in September 2025, from 98.8 in August. The decline follows a brief uptick in May, which came after five consecutive months of moderation since December 2024. Earlier in the year, the REER had risen steadily from 103.66 in January 2024 to a peak of 108.14 in November 2024.

The REER adjusts the nominal effective exchange rate to account for inflation differentials between India and its major trading partners.

A REER value above 100 signals an appreciation of the rupee relative to the base year, which could make Indian exports less competitive in global markets.