Bank of America Merrill Lynch (BofA-ML) said that the Reserve Bank, which had bought USD 840 million of forex in March, has enough space to buy USD 9 billion more from the market.
In a note, Indranil Sen Gupta said, "The RBI has already reported that it had purchased $820 million in March. We estimate that it has bought another USD 1 billion since. It should also buy when Unilever money (for the buyback offer) comes in end-June."
Such a move will not destabilise the forex market unless there is a "sudden spike" in the dollar, which the brokerage expects, will be trading at Rs 52.50 by the end of June, he said.
The report did not specify the period in which the RBI would buy dollars.