The Reserve Bank of India (RBI) on Tuesday said it will make a fresh infusion of about $32 billion of rupee liquidity into the banking system over the next month via open-market operations (OMOs) and a buy/sell dollar-rupee swap.

The central bank will purchase government securities worth Rs 2 trillion ($22.34 billion), with the OMOs spread across four tranches of Rs 50,000 crore on 29 December and in January on 5th, 12th and 22nd.

It will also conduct a $10 billion 3-year dollar-rupee buy/sell swap auction on 13 January.

The measures are aimed at infusing rupee liquidity while also sucking out surplus dollar liquidity to ease the spike in dollar-rupee forward premiums.

The RBI said it will continue to monitor evolving liquidity and market conditions and take measures as appropriate to ensure orderly liquidity conditions.

The RBI has been intervening in the foreign exchange market to defend the rupee from depreciating sharply against the dollar amid absence of a trade deal with the US and outflow of foreign funds.

The rupee has bounced back after breaching the 91 mark to a dollar. This has come at the cost of a liquidity tightening in the banking system.