The RBI ended its FCNR(B) swap facility a month early after mobilising $52.3 billion. The move surprised markets and raised questions about the policy’s intent
The scheme was introduced as the rupee faced pressure from oil prices and capital outflows. Stronger reserves could help cushion currency volatility
Analysts had expected $80-100 billion through various swap windows. The RBI’s decision to stop at just over $50 billion leaves the target unclear
The RBI had indicated days earlier that there was no plan to end the scheme early. The abrupt reversal raises questions about policy consistency
Extra foreign exchange can strengthen the rupee and boost liquidity, but reserve accumulation alone cannot fix India’s underlying external imbalances
India needs durable foreign investment to finance its current account deficit. Weak net FDI and continued BoP pressure make attracting long-term capital essential