Market participants told RBI in a pre-policy meeting that liquidity support is more critical than rate cuts for the February policy.
The Reserve Bank of India used over $2 billion in FX swaps to ease liquidity stress and hedging costs as the rupee hit a record low.
The Reserve Bank of India used over $2 billion in FX swaps to ease liquidity stress and hedging costs as the rupee hit a record low.
The RBI’s swap lowered ⁠dollar/rupee hedging costs, countering the upward pressure on forward premiums that would normally accompany a fall in the currency.
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