RBI tightens forex rules to stabilize rupee but banks face profit squeeze. The central bank capped net open rupee positions at $100 million, a shift from the previous 25 percent capital-based limit. While the move provided brief relief to the battered rupee on Monday, analysts warn that trading revenue will suffer and fundamental economic pressures remain. The rupee hit a record low of 94.81 against the dollar Friday as foreign investors sold heavily, driven by geopolitical tensions between Iran and the US pushing oil prices higher. India imports 90 percent of its oil, making it vulnerable to widening current account deficits. Banks had accumulated between $25 billion and $35 billion in arbitrage positions that pressured the spot rupee.
