India’s forex reserves experienced a significant dip of $7 billion, as reported by the RBI, prompting analysis of the contributing factors and potential impact on the Indian economy.
Illustration: Dado Ruvic/Reuters
Key Points
- India’s forex reserves decreased by $7.052 billion to $709.759 billion in the week ending March 13, according to the RBI.
- Foreign currency assets, a major component of the reserves, fell by $7.678 billion to $555.568 billion.
- Gold reserves increased by $664 million to $130.681 billion during the reporting week.
- The Special Drawing Rights (SDRs) decreased by $23 million to $18.697 billion.
- India’s reserve position with the IMF also decreased by $15 million to $4.814 billion.
India’s forex reserves dropped $7.052 billion to $709.759 billion during the week ended March 13, the RBI said on Friday.
In the previous reporting week, the overall reserves had dropped $11.683 billion to $716.81 billion. The kitty jumped $4.885 billion to an all-time high of $728.494 billion during the week ended February 27.
Decline in Foreign Currency Assets
For the week ended March 13, foreign currency assets, a major component of the reserves, fell $7.678 billion to $555.568 billion, the data released by the central bank showed.
Expressed in dollar terms, the foreign currency assets include effects of appreciation or depreciation of non-US units, such as the euro, pound, and yen, held in the foreign exchange reserves.
Changes in Gold Reserves and SDR
Value of gold reserves increased $664 million to $130.681 billion during the week, the RBI said.
The Special Drawing Rights (SDRs) were down $23 million to $18.697 billion, the apex bank said.
India’s reserve position with the IMF was also down by $15 million to $4.814 billion in the reporting week, according to the apex bank’s data.
