RBI Governor Says Forex Market Curbs Won’t Remain Forever

The Reserve Bank of India’s recent currency market curbs aimed at quelling speculation against the rupee are temporary and will not remain in place forever, Governor Sanjay Malhotra said.

Arbitrage positions had been building between offshore and local markets toward the end of March, Malhotra said. While these linkages are important for efficient price discovery in normal times, excessive volatility and rapid build up of positions can be destabilizing, he added.