The move coincided with the Fed’s planned policy rate decision, which raised the cost of funds by three-quarters of a percentage point. The central bank also eased rules on foreign commercial lending to curb capital outflows and ease pressure on the rupee.īankers said the response to NRE deposits by non-resident Indians could have been better if banks had received additional regulatory support in 2013. Such relaxations will be effective until October 31 and November 4, respectively. On July 6, the Reserve Bank of India (RBI) allowed banks to collect FCNR (B) and NRE deposits from Indian ex-pats without any interest rate cap. “As an experiment, the window has been kept open, coinciding with the Fed’s policy announcement,” said one of the people cited above. The relative success of this round of deposits may prompt HDFC Bank NSE 2.45% to open more such dedicated windows for overseas investors until November. The Middle East tops the list of new NRI savers, while the rest of Asia and Europe are not far behind. Deposits were made in two days last week. India’s most valuable bank, HDFC Bank, is said to have raised $300 million in NRE deposits, 50 basis points above prevailing rates, people familiar with the matter told ET.
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