According to CoinMeta, there has been a surge in capital inflows into India, increasing market expectations for a rate hike by the Reserve Bank of India (RBI). A few months ago, the RBI was working hard to attract dollars in order to increase foreign exchange reserves and defend the rupee. Today, record capital inflows of $133 billion have led to ample liquidity in the banking system, with overnight interest rates falling below the policy rate of 5.25%. To prevent excess liquidity from driving up prices, the RBI has absorbed over 1 trillion rupees (about $10.4 billion) by selling bonds. Market participants expect the RBI to announce further measures in the coming days, as calls for a rate hike grow louder amid rising food and oil prices.