Dollar swap may leave oil marketers with high forex risk: Experts

30 Aug, 2013,(7STAR NEWS)MUMBAI: The Reserve Bank of India\'s special window to sell dollars to state-run oil companies may have helped the rupee rebound on Thursday, but experts say the move puts the oil marketers in high risk of foreign exchange losses.



While the RBI\'s move announced late on Wednesday has eased spot dollar demand and gives a respite for the government to find ways to boost dollar inflows, Craig Chan, executive director and head of forex strategy & fixed income division (Asia-ex Japan) at Nomura Singapore, said oil companies will have to bear the brunt in case the rupee depreciates over the medium term.



\"The measure also runs the risk of a significant increase in dollar demand upon expiration (assuming a six-month tenor of the swap), when oil marketing companies will not only have to deliver dollars back to the RBI, but also purchase dollars through spot (if the scheme is not maintained),\" Chan said.
News From: http://www.7StarNews.com