Indian banks have raised $32 bln under dollar-inflow schemes, RBI chief tells Hindu Businessline

Dollar-inflow schemes announced by the central bank in June have brought in close to $32 ​billion, the central bank governor, Sanjay Malhotra, ‌told The Hindu Businessline newspaper in an interview published on Monday. The inflows are likely to boost ​India’s balance of payments, he said. Here ​are some key comments: Most of the $32 billion ⁠raised so far has come from the foreign ​currency non-resident deposit scheme, Malhotra said. In addition, about $7 ​billion has come in as foreign portfolio investments into debt securities following tax changes. Have not seen any evidence ​that a bulk of the FCNR flows ​are on account of rebooking of deposits. An increase in government ‌cash ⁠balances is partly the reason for dollar inflows not reflecting on rupee liquidity. Indian rupee set to rally after crude drops on Mideast respite, RBI-led inflows build There has been no change in the RBI’s policy on the ​rupee and the ​central ⁠bank only intervenes to curb excessive volatility. It would be reasonable to think ​the rupee is not undervalued. The current ​level of ⁠the policy repo rate is appropriate for the prevailing growth-inflation dynamics. Generalised inflation pressures are modest so ⁠far ​but the risk of ​higher food and fuel prices translating into broad-based inflation environment is ​real.

Read full story on Business Recorder