RBI to infuse liquidity in bond market as forex reserve dips by $3.22 bn

From Rs 4 trillion in June 2017, the core liquidity in the banking system has now fallen to about Rs 400 billion

The Reserve Bank of India (RBI) has moved to address pressure points in both currency and bond markets.

The central bank’s foreign exchange reserves dipped by $3.22 billion in the week to 27 April, after having fallen by $2.5 billion in the week before, according to the RBI data. This is the sharpest fall in forex reserves since the week ended October 7, 2016, when the reserves had dipped by $4.3 billion. Most of the dip is to check the rupee’s rapid slide, currency dealers say.

The central bank has also tried to soothe the frayed nerves of bond dealers