Reuters Market Eye - The RBI should start tapering its dollar swap facility for oil companies given it has already been priced in by markets, Bank of America-Merrill Lynch said in a report dated November 5.
The removal of the dollar window could mark a key signal of stability for the rupee, and the Reserve Bank of India has said any such action would be done in a calibrated manner.
BofA-Merrill notes that with FX reserves of about $280 billion, it would be hard to continue to fund net oil imports that average $8-$10 billion a month.
The bank expects the rupee to stabilise between 61-63 per dollar levels, helped by an expected $15 billion that will be raised via the RBI's two foreign currency non-resident windows and the potential inclusion of Indian debt into global benchmarks, which could raise about $20-$25 billion.
(Reporting by Swati Bhat)
