Current affairs, 20 August 2026: RBI expects $80 billion in forex inflows, and the MPC keeps a rate hike on the table

Today is a banking and economy day, so it matters most for a bank exam, but the numbers below are standard general-awareness fare and worth a line in any paper. Both items come from the Reserve Bank of India and both carry figures an examiner likes to test.

The headline: at least $80 billion in forex inflows

In an interview published on 20 August, RBI Governor Sanjay Malhotra said the central bank expects at least $80 billion in foreign-currency inflows from three schemes taken together: FCNR(B) deposits, external commercial borrowings (ECBs) and overseas foreign currency borrowings (OFCBs). Business Standard

A little background makes this readable:

• The measures were introduced in June 2026 to support a weak rupee. Banks were allowed to offer attractive rates on foreign-currency deposits, with the RBI subsidising the hedging cost.
• FCNR(B) stands for Foreign Currency Non-Resident (Bank) deposits — term deposits that non-resident Indians hold in foreign currency, so the bank, not the depositor, carries the currency risk.
• As of 13 August, FCNR(B) deposits under the facility stood at $52.3 billion, and with ECBs and overseas borrowings the total was about $56.85 billion.
• The RBI has advanced the closure of the FCNR(B) swap window to 31 August 2026 (from 30 September). Malhotra called this a “data-driven calibration” taken “from a position of strength”, not a reversal, because inflows ran stronger than expected. The Financial Express

He also gave a quick health check of the banking system, which is itself examinable: banks’ capital to risk-weighted assets ratio (CRAR) near 18%, a liquidity coverage ratio of about 127%, and gross and net NPA ratios of 1.7% and 0.4%, with stress tests pointing to resilience even under adverse conditions.

The other half: the MPC keeps a rate hike in view

The minutes of the August Monetary Policy Committee (MPC) meeting, released on 19 August, show the six-member committee unanimously held the repo rate at 5.25% at its 3–5 August meeting, but flagged that policy tightening may be needed later in the year if higher food, fuel and input prices spread into broad-based inflation. News18

Two things to hold on to: headline inflation is projected to rise to as much as 5.9% in the third quarter of 2026-27, and the next MPC meeting is on 5–7 October 2026.

What to write in your notebook

Three lines:

1. The RBI expects at least $80 billion from three schemes together — FCNR(B) deposits, ECBs and OFCBs — and has advanced the FCNR(B) swap-window closure to 31 August 2026, which the Governor calls a “calibration”, not a reversal.
2. The repo rate stays at 5.25%, but the August MPC minutes keep a later rate hike on the table if inflation broadens; the next MPC is on 5–7 October 2026.
3. Banking-system health, in the Governor’s words: CRAR near 18%, LCR about 127%, and gross and net NPAs of 1.7% and 0.4%.