- 07 Jul 2022
- ICICIdirect Research
RBI ANNOUNCES SLEW OF MEASURES TO ATTRACT FOREIGN EXCHANGE FLOWS TO INDIA
News: In order to attract foreign exchange flows in India, RBI has announced a slew of measures. Among steps taken to attract dollars, banks have been exempted from maintaining the CRR and SLR for incremental NRE and FCNR (B) (foreign currency non-resident-bank) deposits with effect from reporting fortnight beginning July 30. This relaxation will be available for deposits mobilised up to November 4, 2022. Banks also have been allowed to raise fresh FCNR (B) and NRE deposits without reference to the regulations on interest rates, with effect from July 7. This relaxation will be available for the period up to October 31, 2022
Views: This is likely to be positive for mid-sized banks as it will shore up their deposit base. Further, demand led reduction in yields to provide breather to PSU banks on treasury front
Impact: Positive