Wary of RBI, banks back off from forex deals
The banks, using the easy rupee liquidity created after the inflow of deposits from the diaspora, bought dollars and invested the funds in US Treasury bills to earn higher returns. The transaction involved a buy-sell swap, where banks purchased dollars in the spot market and sold dollars in the forward market. The dollars generated through the swaps were deployed in US government papers, whose yields have risen in the past three months.
Synopsis The banks, using the easy rupee liquidity created after the inflow of deposits from the diaspora, bought dollars and invested the funds in US Treasury bills to earn higher returns. The transaction involved a buy-sell swap, where banks purcha... [4541 chars]
Read the full report on The Economic Times
Story file
- Section
- Business
- Topics
- Economy & RBI
- First reported by
- The Economic Times
- Published
- Tuesday, 27 October 2026, 12:53 am IST
- Coverage
- One outlet so far
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