RBI Rupee Support Measures 2026 💰 | Foreign Exchange Risk Reserve (FERR) | Current Affairs MCQ

Q3. In response to recent currency volatility, commercial banks have urged the Reserve Bank of India (RBI) to reconsider which specific rupee-support regulatory measure?

✅ Correct Answer: The 20% Foreign Exchange Risk Reserve (FERR) requirement on specified foreign exchange derivative transactions.

In October 2026, banks sought relaxation and clarification of the RBI’s new forex regulations aimed at stabilising the Indian rupee. The 20% reserve requirement raised concerns about liquidity, compliance costs and the cost of hedging currency risks. Banks also proposed replacing the reserve requirement with a direct fee on eligible transactions.

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