RBI to cut swap rates on foreign currency deposits from March 1

Tags: News
The Reserve Bank of India will cut the ceiling on its swap windows for 3-5 year foreign currency non-resident deposits FCNR-(B) by 100 basis points from March 1, the central bank said on Friday.

The new rates will be LIBOR/Swap plus 300 basis points, down from LIBOR/Swap plus 400 bps earlier for maturities of three to five years, the central bank said.

That returns the ceiling on its swap windows for these maturities to the same levels as before August last year. The central bank had raised the ceiling to LIBOR/Swap plus 400 bps to help attract more inflows from abroad.

The ceiling on its swap windows for FCNR-(B) of more than one-year but less than three-year maturities will remain at the existing LIBOR/Swap plus 200 basis points.

Separately, the central bank also extended the timeline for banks offering variable interest rates on incremental non-resident external (NRE) deposits until February 28 from January 31.

However, from March 1, the rates will have to be set at par with comparable local interest rates for rupee deposits, the RBI added.

Post new comment

E-mail ID will not be published
CAPTCHA
This question is for testing whether you are a human visitor and to prevent automated spam submissions.

EDITORIAL OF THE DAY

  • Lower home loan rates signal tough fight for market share

    Barely four weeks ago, a few public sector banks reduced interest rates on time deposit schemes by 10 to 25 basis points, depending on the tenure of t

FC NEWSLETTER

Stay informed on our latest news!

INTERVIEWS

GV Nageswara Rao

MD & CEO, IDBI Federal Life

Timothy Moe

Goldman Sachs

Chander Mohan Sethi

CMD, Reckitt Benckiser India

COLUMNIST

Tushar Gandhi

Could prohibition mean profiteering?

In the mid 1930s, an American journalist asked Bapu if ...

Zehra Naqvi

The five universal languages of love

Love is a universal language. Don’t we all believe that? ...

Dharmendra Khandal

Time to protect our endangered wildlife species

After 65 million years of existence, the earth’s biodiversity is ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture