India central bank's $10 billion FX swap oversubscribed, cut-off at 5.86 rupees

The Reserve Bank of India (RBI) conducted a $10 billion, 3-year dollar/rupee buy-sell swap auction to increase rupee liquidity, which was oversubscribed by over two times. The set cut-off rate for the auction was 5.86 rupees. Through the swap, the RBI will inject $10.04 billion worth of rupees into the banking system, with the transaction set to reverse in three years. This measure is part of the RBI's broader efforts to address a liquidity shortage in the banking sector, estimated at 2 trillion rupees ($23.27 billion) as of last Friday.