• India's central bank is successfully defending the rupee, pushing it to a two-month high despite rising oil prices and US Treasury yields Published September 2, 2026 Updated about 14 hours ago By Reuters MUMBAI: The Reserve Bank of India has stepped up its support for the rupee in recent sessions, shielding the currency from a surge in oil prices and rising U.S. Treasury yields, with a flood of deposits from non-resident Indians bolstering the central bank’s firepower. The rupee has rallied past the 95-per-dollar mark to a two-month high, catching much of the market by surprise given the headwinds facing the currency. Brent crude has jumped 7% so far this week to $95.50 a barrel. The 10-year U.S. Treasury yield has climbed to its highest level in nearly three years, while the dollar index is approaching the 100 mark. The RBI has repeatedly stepped in with dollar sales, absorbing the impact of adverse external developments and pushing rupee higher. Bankers say the central bank has been increasingly active before the formal market opening over the last three sessions, followed by intervention through the trading day. Previously, the central bank largely stepped in to curb weakness in the rupee, and more recently it appears to be using its intervention to push the currency higher, the bankers said. “The RBI’s intention seems to be to insulate the rupee from the pressure that is building up from oil prices,” said Sakshi Gupta, principal economist at HDFC Bank. “The larger FX reserve buffer provides it higher scope to intervene and by demonstrating its willingness to keep supporting the currency, it will deter any…