Bhaskar Dutta

Indian bonds fell as the minutes of the central bank’s latest policy meeting stoked fears of interest rates being raised sooner than expected as policymakers emphasized inflation risks.

Citigroup Inc. has tied up with Axis Bank Ltd. to finance non-resident Indians investing in foreign-currency deposits with the local lender, according to people familiar with the matter.

Citigroup and Axis Bank have tied up to finance non-resident Indians investing in foreign-currency deposits, leveraging RBI rules that allow standby letters of credit against such deposits. The arrangement could amplify dollar inflows through offshore financing as India seeks to strengthen foreign-exchange reserves and support the rupee amid strong NRI deposits.

Citigroup and Axis Bank have tied up to finance non-resident Indians investing in foreign-currency deposits, leveraging RBI rules that allow standby letters of credit against such deposits.

HSBC Holdings Plc has purchased at least $3 billion of Indian government bonds since July, deploying a large pool of funds garnered under a special diaspora dollar deposit program, according to people familiar with the developments.

India’s central bank is intensifying efforts to support the rupee, emboldened by a jump in its foreign-exchange reserves to contest the pressure from higher oil prices.

India’s foreign-exchange reserves climbed to a record high as dollar inflows surged after recent measures by the central bank to attract capital.

Steps taken by RBI in early June hel avert what could have been an unprecedented third year of a deficit in India’s broadest measure of money flowing in and out of the economy.

India’s rupee strengthened to a two-month high as the central bank, bolstered by record foreign-exchange reserves, stepped in to support the local currency through dollar sales.

RBI intervention helped the rupee outperform regional peers as US-Iran tensions and rising oil prices weighed on currencies.