Indian banks pull $72.8 billion via RBI's dollar-swap scheme as inflows surge
Banks have drawn $72.8 billion in foreign-currency inflows through RBI’s dollar-swap programme by Aug 21, with the pace accelerating sharply in recent weeks.
According to RBI figures released Saturday, banks have attracted $72.8 billion of foreign-currency inflows through the central bank’s dollar-swap scheme as of Aug 21, marking a steep weekly acceleration. FCNR(B) deposits accounted for $65.4 billion of the total, while overseas foreign-currency borrowings contributed $4.9 billion and external commercial borrowings $2.6 billion. Inflows rose from $40.8 billion on July 31 to $56.9 billion on Aug 13 and $72.8 billion on Aug 21, adding $32 billion in three weeks.
HSBC, State Bank of India, ICICI Bank and HDFC Bank emerged as the top mobilisers, with other private banks also increasing activity, whereas most public-sector banks were slower. The surge helped raise India’s forex reserves by nearly $10 billion in the week to Aug 15, and RBI expects reserves to exceed the historic high of $728 billion by month-end. In response, RBI moved the deadline for qualifying FCNR(B) deposits to Aug 31 and extended the swap period for those deposits to Sept 11, while ECB and OFCB components remain open until Dec 31.
Why it matters
The inflows boost India's foreign-exchange reserves and lower currency-risk costs for banks.
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