RBI Draws Nearly $73 Billion in Forex Swaps, Halting Rupee Decline as Iran War Drains Reserves
Updated
Updated · linkedin · Aug 24
RBI Draws Nearly $73 Billion in Forex Swaps, Halting Rupee Decline as Iran War Drains Reserves
3 articles · Updated · linkedin · Aug 24
Summary
Nearly $73 billion has moved through the RBI’s forex swap facility, but the rupee has shown little appreciation even as the program appears to have stopped its slide.
High oil and gas prices and trade disruption tied to the Iran war pushed India’s economy and reserves under pressure, prompting the RBI to use the swaps to shore up foreign-exchange buffers.
Reserve levels have improved after a slow start, and the inflow total could look stronger by Aug. 31, though the central bank is expected to bear a meaningful cost.
More than $65 billion of the broader inflow has come from special non-resident Indian deposits, reviving a 2013-style defense against energy-driven external stress and capital outflows.