The reserve Bank of India will deliver an exchange of $ 5 billion dollars calling on Monday on Monday, with excess rupee-liquidity in the banking system that has little need for a rollover, four bankers said.
Delivery of the swap without a rollover implies that the RBI sells dollars and absorbs rupees from the banking system – a move that is unlikely to disturb money markets, with rupees currently in excess, said bankers, because they are not authorized to speak with the media.
The $ 5 billion buy-sell dollar/rupee six months SWAP, which ripens on Monday, was part of a series of measures that the central bank had taken to stimulate the liquidity of the rupee from the end of January to May.
“The goal of the Swap was to inject INR liquidity,” said a senior treasury officer at a lender runned by the state. At the time of initiating the SWAP in January, the central bank bought dollars and injected rupees into the banking system.
“Now that the system is carrying out a surplus, realizing will not cause a disturbance – and that offers RBI space to deliver it.”
The liquidity surplus of India has risen to more than £ 3.60 Lakh Crore – the highest in four weeks and equivalent to approximately 1.5 percent of the total deposits. RBI head Sanjay Malhotra had indicated in April that the central bank is looking at keeping track of surplus levels around 1 percent of the deposits.
“The central bank will not overrun the Swap,” said VRC Reddy, Treasury Head at Karur Vysya Bank, “At the moment the liquidity of the rupee is very comfortable and makes sense to the central bank to deliver the dollars.”
Furthermore, a SWAP trader said at a medium-sized bank of the private sector that he had not seen or heard large Buy/Sell Swaps that were carried out through the state of Banken-A Development that would usually accompany a rollover of the RBI.
Dollar call in the short term Swaps did not show any signs of disruption due to the duration of the RBI RWAP. The Cash-Tomorrow swap was quoted at 0.34/0.35 Paisa, which implies an annual yield of approximately 5.8 percent marginal above the interbancar call speed.
Published on August 4, 2025
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