RBI drains $20 billion liquidity via FX operations: What it means for rupee, rates
The Reserve Bank of India drained an estimated $20 billion in excess rupee liquidity through foreign exchange operations, primarily using dollar-rupee swaps. This action reduced the banking system's liquidity surplus from ₹14.2 trillion to ₹11.5 trillion. Economists predict an additional ₹1.5 trillion may be removed, impacting dollar-rupee forward premiums and hedging costs.