Forex swap auction is a hit, but RBI needs to assess future risk as well
6 years ago

Forex swap auction is a hit, but RBI needs to assess future risk as well

Live Mint  

If the maiden foreign exchange swap auction was a test case for performance as a tool for liquidity management, the Reserve Bank of India just got itself a winner. The central bank received bids totalling $16.3 billion at the swap auction where it proposed to buy $5 billion from lenders. Also, getting a three-year swap deal at a relatively cheaper price makes sense, as the cut-off premium on the swap was set at ₹7.76 by the central bank. Also, as pointed out in this column last week, in late 2016, when swap deals as part of the special scheme of FCNR deposits were due, forward premium had risen and the rupee had weakened as lenders had to deliver dollars to the central bank.

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RBI’s FX swap auction sees strong demand as system liquidity deficit persists
Trending News
1 month ago

RBI’s FX swap auction sees strong demand as system liquidity deficit persists

Live Mint  

Mumbai: The Reserve Bank of India today saw strong demand its foreign currency buy/sell swap auction amid persistently tight liquidity deficit in the banking system. RBI will try to keep deficit in the system around ₹1-1.5 trillion and will use instrument like OMO buy/ Fx swap and if needed may be CRR as well,” Gopal Tripathi, President and Head, Treasury …

RBI injects $10 billion via currency swap to ease liquidity deficit in financial system: Report
Trending News
1 month ago

RBI injects $10 billion via currency swap to ease liquidity deficit in financial system: Report

Live Mint  

The Reserve Bank of India injected $10 billion through a currency or foreign-exchange swap auction on Friday, stepping up efforts to ease one of the worst liquidity deficits to hit the country's financial system. The cash crunch has been caused partly by the central bank’s intervention in the foreign exchange market to shield the rupee from global volatility amid US …

India bond traders eye debt auction, GDP data for directional cues
1 month ago

India bond traders eye debt auction, GDP data for directional cues

Live Mint  

By Dharamraj Dhutia MUMBAI, Feb 28 - Indian government bond yields were largely unchanged in early deals on Friday, as market participants awaited a weekly auction as well as domestic GDP growth data. New Delhi aims to raise 320 billion rupees through a sale of bonds, in what would be the last scheduled auction for central government bonds for the …

​Necessary infusion: on the RBI’s currency swap
1 month ago

​Necessary infusion: on the RBI’s currency swap

The Hindu  

The Reserve Bank of India’s recent decision to inject an additional $10 billion into the financial system through a dollar/rupee swap auction is a timely measure aimed at addressing long-term liquidity concerns among domestic lenders. These concerns stem from a flight of foreign capital from Indian stock markets, as investors seek better returns in the United States amid President Donald …

RBI to conduct USD-INR swap auction of $10 bn for 3 years’ tenor to inject liquidity
1 month, 1 week ago

RBI to conduct USD-INR swap auction of $10 bn for 3 years’ tenor to inject liquidity

The Hindu  

To meet durable liquidity needs of the banking system, the Reserve Bank of India has decided to inject rupee liquidity for longer duration through long-term USD-INR buy/sell swap auction. Once the auction window is closed, all the bids would be arranged in descending order of the swap premium quoted and the cut-off premium would be arrived at the premium corresponding …

RBI to continue interventions in forex market, despite tight liquidity
2 months, 1 week ago

RBI to continue interventions in forex market, despite tight liquidity

Live Mint  

Tight liquidity will not bind the Reserve Bank of India’s hands in intervening to curb excessive rupee volatility in the forex market, said a senior official aware of the thinking at the central bank. While liquidity management will not be a constraint for RBI to intervene in the forex market, bankers believe that the central bank will have to infuse …

Opinion | Why the Reserve Bank is playing with fire with currency swaps
5 years, 10 months ago

Opinion | Why the Reserve Bank is playing with fire with currency swaps

Live Mint  

Important changes are afoot in the Reserve Bank of India liquidity management system, and yet this has elicited relatively little serious analysis or scrutiny. As astutely pointed out by columnist Diva Jain, writing in Business Standard on 23 April, the RBI is operating like a hedge fund, taking on considerable interest rate and exchange rate risk, as defined by both …

Another $5bn dollar-rupee swap auction on April 23
5 years, 11 months ago

Another $5bn dollar-rupee swap auction on April 23

Deccan Chronicle  

Mumbai: The Reserve Bank of India on Monday said it would conduct another round of dollar-rupee buy-sell swap of $5 billion for a tenure of three years on April 23. “In order to meet the durable liquidity needs of the system, the Reserve Bank has decided to inject rupee liquidity for longer duration through long-term foreign exchange buy/sell swap in …

RBI to inject $5 bn more liquidity through second dollar-rupee swap auction on 23 April
5 years, 11 months ago

RBI to inject $5 bn more liquidity through second dollar-rupee swap auction on 23 April

Firstpost  

Mumbai: The Reserve Bank of India on Monday said it will inject long-term liquidity worth $5 billion into the banking system through dollar-rupee buy-sell swap for a tenure of three years on 23 April, the second such auction within a month. Earlier on 26 March, the central bank had bought $5 billion through similar swap auction in a bid to …

Mumbai: RBI’s $5 billion forex swap auction proves a hit
6 years ago

Mumbai: RBI’s $5 billion forex swap auction proves a hit

Deccan Chronicle  

Mumbai: The Reserve Bank of India’s $5-billion forex swap auction on Tuesday elicited strong response from banks, with bids coming in for more than three times the amount of dollars sought. Under the dollar/rupee swap auction, the central bank received 240 bids worth $16.31 billion against the notified amount of $5 billion. Says Ashutosh Khajuria, Executive Director at Federal Bank, …

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