Finance
The Reserve Bank of India (RBI) reported that India’s foreign exchange (forex) reserves fell by $1.77 billion to $595.95 billion for the week ending May 6, owing to a sharp drop in the country’s foreign currency assets.
Overall reserves fell by USD 2.695 billion to USD 597.728 billion in the previous reporting week, falling below the USD 600 billion mark.
The RBI is reportedly intervening across all markets to defend the currency, which is under pressure due to heavy outflows by foreign investors. In the six months to March 2022, foreign exchange reserves fell by USD 28.05 billion.
This is the country’s ninth weekly decline in foreign exchange reserves. The forex reserves fell by $2.695 billion to $597.728 during the week ending April 29. This is India’s lowest level of forex reserves in a year. After reaching an all-time high of $642.453 billion on September 3, 2021, India’s forex reserves have plummeted dramatically.
According to the RBI’s weekly data, the fall in reserves was due to a decline in Foreign Currency Assets (FCA), a major component of overall reserves, and gold reserves during the reporting week.
FCA fell by USD 1.968 billion in the week ending May 6 to USD 530.855 billion.
Foreign currency assets, expressed in dollars, include the effect of appreciation or depreciation of non-US units such as the euro, pound, and yen held in foreign exchange reserves.
According to the data, gold reserves increased by USD 135 million in the reporting week to USD 41.739 billion.
During the week ending May 6, India’s reserve position at the International Monetary Fund (IMF) fell by $11 million to $4.990 billion.
During the week ending May 6, India’s reserve position at the International Monetary Fund (IMF) fell by $11 million to $4.990 billion.
Source:Mint
