India's forex reserves declined for second week straight, as per RBI's latest data. In the week that ended on May 26th, the country's reserves plunged by $4.339 billion. All components in reserves witnessed a fall in the week under review with foreign currency assets dragging the most.
The latest weekly data from RBI showed that forex reserves dipped by $4.339 billion to $589.138 billion in the week that ended on May 26, 2023. Prior to this week, the decline was around $6.052 billion.
The biggest spoilsport would be foreign currency assets (FCA) which is the largest component of reserves. FCA dipped by $4.014 billion to $520.931 billion during the May 26th week. In the previous week, FCA fell by $4.654 billion.
Furthermore, in the week that ended on May 26th, gold reserves declined by $225 million on a week-on-week basis to $44.902 billion. Also, SDRs contracted by $84 million to $18.192 billion. While the reserve position at IMF dropped by $17 million to $5.113 billion.
India's forex reserves were at an all-time high of $645 billion in October 2021. Meanwhile, India’s foreign exchange reserves were placed at $ 578.4 billion as on March 31, 2023.
To cushion rupee depreciation, RBI has been intervening in the forex market via both spot and forward positions.
In the week from May 29th to June 2nd, the Indian rupee witnessed its best week in five due to a weakening in the US dollar as anticipation for a rate pause heightened from US Federal Reserve in June policy. Overall, this week, the rupee appreciated by 0.32%.
At the interbank forex market, on Friday, the rupee closed at 82.3050 per dollar, after reaching to the highest level since May 17 at 82.28 per dollar.
Updated: 02 Jun 2023, 06:23 PM IST
Forex reserves decline for second week straight, now at $589.14 billion | Mint - Mint
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