MUMBAI (Reuters) -The Indian central bank likely conducted dollar-rupee buy/sell swaps on Tuesday alongside intervention in the local over the counter spot market to support the rupee, four traders told Reuters.
Under a buy/sell swap, the Reserve Bank of India undertakes delivery of dollars at the spot rate, which will be reversed at a future date.
The rupee was last at 88.77 per U.S. dollar, little changed on the day, but hovering just shy of its all-time low of 88.80 hit last week.
Dollar-rupee forward premiums pulled back on account of the central bank’s buy/sell swaps, with the 1-year implied yield retreating 6 basis points to 2.23%, the lowest in a month.
(Reporting by Jaspreet Kalra; Editing by Sonia Cheema)
