RBI attracts $136.38 billion through forex swap facility by Aug. 31

  • RBI attracted $136.38 billion through its forex swap facility by Aug. 31.
  • Banks received $127.23 billion through foreign currency non-resident deposits.
  • The diaspora deposit window closed Aug. 31, while bank borrowings remained open.

The Reserve Bank of India (RBI, India's central bank) attracted $136.38 billion through its forex swap facility by Aug. 31, with $127.23 billion coming through foreign currency non-resident deposits, a dollar deposit scheme aimed at the diaspora. Banks also raised $3.89 billion through external commercial borrowings and $5.26 billion via overseas foreign currency borrowings. Introduced in June, the concessional swap measures were designed to draw foreign currency into India and bolster the rupee, which had reached record lows earlier this year. Banks exchange the inflows with the RBI, increasing the country's foreign exchange resources and giving the central bank greater capacity to support the currency. The diaspora deposit window, originally scheduled to run through September, closed on Aug. 31, while the bank-borrowing window remains open. India's foreign exchange reserves reached a record $729.33 billion in the week to Aug. 21, and traders said the RBI had increased dollar sales in recent days. The rupee finished little changed on Wednesday as central-bank support offset importer demand, higher oil prices and rising Treasury yields.

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