A dollar/rupee buy/sell swap involves RBI buying dollars and giving banks rupee liquidity in the first leg (February 6) of the transaction
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The Reserve Bank of India’s (RBI) bid to absorb dollars and provide durable rupee liquidity to the banking system via a three-year US dollar/rupee buy/sell swap auction on Wednesday saw robust demand, with market participants seeking to deploy $25.03 billion against the notified amount of $10 billion.
The Central bank absorbed the notified amount of $10 billion thereby, providing the banking system rupee liquidity amounting to about ₹90,000 crore. The auction was part of RBI’s liquidity infusion measures.
The cut-off premium at the latest auction was higher at 748 paise against the previous auction’s 728 paise.
A dollar/rupee buy/sell swap involves RBI buying dollars and giving banks rupee liquidity in the first leg (February 6) of the transaction. The second leg (on February 6, 2029) entails reversal of the first leg of the swap transaction.
The RBI is trying to achieve twin objective through the auction – bolster the banking system’s durable rupee liquidity even as the Central bank’s ability to intervene in the forex market increases to the tune of $10 billion.
Published on February 4, 2026
