RBI buys $5bn in FX swaps auction

Unusual move to inject long-term liquidity into the system is heavily oversubscribed

rupee-india-counting-notes

A move by the Reserve Bank of India to inject long-term liquidity into the market drew strong demand in an auction today (March 26).

The one-off foreign exchange swap saw the central bank buy $5 billion from banks in exchange for 345.6 billion rupees with a tenor of three years. One US dollar was worth 69 rupees in trading this afternoon.

The operation was heavily oversubscribed, with bids totalling $16.3 billion and successful bidders paying an average premium of 7.92 rupees. Banks will pay

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