India cenbank likely bought dollars in spot, paid in far forwards – traders

MUMBAI, July 25 (Reuters) – The Reserve Bank of India likely bought dollars and conducted sell/buy swaps via public sector banks after the rupee reached a more-than-two-month high on Tuesday, three traders told Reuters.

The rupee was last at 81.7950 to the US dollar, off the day’s high of 81.6750.

The USD/INR 1-year forward implied yield rose 3 basis points to 1.72%.

Two public sector banks were buying dollars, likely for the RBI, while a large private sector bank was on the bid on USD/INR for its importer clients, a currency trader said.

Public sector banks were conducting sell/buy swaps for June delivery, indicating that the RBI was sterilizing the spot intervention, traders said.

Reporting by Nimesh Vora; Editing by Savio D’Souza

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