RBI Governor Sanjay Malhotra says the central bank does not target the Rupee's value but focuses on preventing volatility and ensuring market stability amidst global economic pressures and inflation challenges.
RBI's Stance on Rupee and Market Stability
The Reserve Bank of India (RBI) does not target “any price or level for the Rupee,” but will continue to take necessary measures to curb speculative activities and excessive volatility to ensure orderly conditions in the foreign exchange market, said RBI Governor Sanjay Malhotra. Speaking at the NDTV World Summit 2026 in New Delhi, RBI Governor Sanjay Malhotra said the central bank has not hesitated to take necessary measures to curb speculative activities and excessive volatility in the foreign exchange market, emphasising that the apex bank primarily aims to prevent disruptions and ensure orderly market conditions. “We do not target any price or level for the Rupee, but at the same time, it has been our endeavor that we ensure orderly market conditions in the forex markets and so we have not hesitated,” he said.
Global Economic Challenges and Central Bank Mandates
Malhotra said geopolitical tensions, supply chain disruptions, the West Asia conflict and trade-related uncertainties have made the job of central banks more challenging, although their fundamental responsibilities remain unchanged. Highlighting the pressure on the global economy, he said, “Globally, the inflation levels, are elevated. It's not only crude, even commodity prices are higher. Growth, on the other hand, globally is lower, is projected at 3.1% for this year as per IMF.”
Prioritizing Price Stability
Malhotra stressed, price stability remains the primary responsibility of central banks, alongside growth objectives for some institutions and the need to maintain financial stability. “While growth is lower, inflation is higher globally and so that makes the role of a central banker more challenging. The role of a central banker primarily being number one across the globe, without exception, price stability, along with a dual mandate for some of the central banks, which is growth and financial stability being the other equally important mandate.”
Domestic Economic Outlook
Malhotra said most economies across the world have raised policy interest rates to tackle rising inflation, except a few countries, including Japan and Sweden, where inflation remains relatively low. Turning to India, he said the country entered the period of global economic challenges with relatively favourable initial conditions in February. However, inflation has since risen steadily, largely due to supply-side pressures, reaching 5.5 per cent. He also noted that the RBI had raised the policy repo rate by 25 basis points in response to evolving economic conditions. “We continue to follow and endeavour to meet the twin objectives of price stability, rein in the inflation, that's our goal number one, while at the same time ensuring that there is financial stability,” he said.
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