RBI to inject USD 10 billion liquidity through three-year Dollar-Rupee swap

Mumbai (Maharashtra) [India], December 24 : The Reserve Bank of India (RBI) on Wednesday announced a major liquidity infusion through a long-term dollar-rupee swap, aimed at easing liquidity conditions in the financial system.

In a press release, RBI said it will conduct a USD/INR Buy/Sell swap auction of USD 10 billion with a tenor of three years. "The auction is scheduled to be held on January 13, 2026, between 10.30 am and 11.30 am."

Under the swap arrangement, banks will sell US dollars to the RBI in the near leg and simultaneously agree to buy back the same amount of dollars at the end of the three-year period. The near-leg settlement will take place on January 15, 2026, while the far-leg maturity date is January 16, 2029.

Bids in the auction will be placed in terms of the swap premium, quoted in paisa up to two decimal places. The auction will follow a multiple-price format, meaning successful bidders will be allotted amounts at the premium they have quoted, subject to the cut-off premium decided by the RBI.

Only Authorised Dealer Category-I banks will be eligible to participate in the auction, as per the RBI.

The minimum bid size has been fixed at USD 10 million, with bids allowed in multiples of USD 1 million thereafter. The results of the auction will be announced on the same day, the RBI said.

The central bank also clarified that swaps undertaken under this auction cannot be cancelled or modified, and participating banks will be exempted from ISDA documentation requirements for these transactions.

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