India's central bank pushes new forex measures on oil companies

State owned oil companies have been ordered by the RBI to buy half their forex needs from public banks.

This is the central bank's most recent effort to curb the volatility of the rupee and prevent further losses.

Here's more from BBVA Research:

The Indian rupee hit a record low of 57.3/USD today amid a spike in global risk aversion, weakening domestic fundamentals and dollar purchases by oil and gold importers.

In its latest efforts to curb volatility and stem further currency losses, the RBI is directing state owned oil companies to satisfy half of their total forex needs from a public sector bank without putting pressure on currency markets, while the rest can be sourced through competitive bids.

Looking ahead, while global risk aversion and India's domestic slowdown can be expected to continue to pressure the rupee in the very near term, it seems the currency will appreciate later this year.