Finance
India’s foreign exchange reserves declined by roughly $2 billion to a six-month low of $652.87 billion as of December 13, according to figures from the Reserve Bank of India (RBI) released on Friday.
The reserves fell by $3.2 billion in the week of December 6, and have dropped by $52 billion since the record high of $704.89 billion set on September 27.
Changes in foreign currency assets are driven by both the central bank’s activity in the forex market and the appreciation or depreciation of foreign assets kept in reserves.
The RBI intervenes on both sides of the forex market to curb undue volatility in the rupee.
Last week, the rupee fell to an all-time low of 84.88, dragged down by yuan weakness and continuously strong dollar bids in the non-deliverable forwards market. The currency dropped 0.1% last week.
The domestic unit closed at 85.0150 on Friday, down for the seventh consecutive week. It fell to a record low of 85.10 earlier in the day, following a hawkish shift in the Federal Reserve’s future outlook for policy rates.
The forex reserves include India’s reserve tranche position in the International Monetary Fund.
Source: IE
