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RBI's cash infusion not enough to cheer market, arrest Rupee's slide

The nation's foreign-exchange reserves have declined by almost $6 billion in the last two weeks, a sign the RBI intervened to support the rupee

RBI, Reserve Bank of India
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A woman walks past the Reserve Bank of India (RBI) head office in Mumbai | Photo: Reuters

Kartik Goyal | Bloomberg New Delhi
Bond investors are finding out that the Reserve Bank of India isn’t as generous as they thought.
 
Sovereign debt declined for a third day Friday, wiping out gains fueled by the RBI’s May 4 decision to inject cash by buying bonds. The measure has failed to revive demand for debt as it simply restores the cash drained by the authority to prop up a sliding rupee, traders say.
 
“The RBI could do more OMO purchases because of the run on the rupee,” said Vijay Sharma, executive vice president for fixed-income at PNB Gilts. The liquidity infusion gets “neutralized” when the

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