Wary of RBI, banks are pulling back from bank forex deals, using the slight liquidity in the rupee created after deposits poured in from the diaspora, bought dollars and invested the funds in US Treasuries to earn higher returns. The deal involved a buy-sell swap, where banks bought dollars in the spot market and sold dollars in the forward market. The dollars generated through the swaps were deployed in US government bonds, whose yields have risen over the past three months.