India and Japan sign new $15B currency swap agreement
India and Japan have signed a $15bn (£9.7bn) currency swap agreement as the two nations seek to boost financial co-operation.
It will see them swap currencies for US dollars and tap into each other’s foreign exchange reserves to ease any liquidity problems.
The pact is expected to boost the Indian rupee which has been Asia worst performing currency this year.
The Japanese yen has also been volatile in wake of an uncertain global outlook.
“Amid global economic uncertainties, ensuring the stability of the financial markets is all the more important for the stable economic development of the two countries,” Japanese prime minister Yoshihiko Noda and Indian prime minister Manmohan Singh said in a joint statement after their meeting in New Delhi.
“swap currencies for US dollars and tap into each other’s foreign exchange reserves to ease any liquidity problems”
is this a good thing for the USD? the fact that its being used? or is it more bad news?