India’s foreign exchange (Forex) reserves rose by $1.46 billion to $562.40 billion in the week ending on March 3, reported news agency Reuters citing the Reserve Bank of India’s (RBI) statistical supplement published on Friday. This is after the country’s forex reserves declined for five straight weeks. The reserves declined $325 million to $560.942 billion in the week of February 24.
In the previous four weeks, foreign exchange reserves declined almost by $15.8 billion, the report said.
In October 2021, the forex kitty reached an all-time high of $645 billion. The reserves have been declining as the RBI deployed the reserves to defend the rupee amid pressures due to various factors, mainly global developments. The RBI has previously said that changes in reserves also result from gains or losses in valuation.
The report said that Rupee climbed over 82 for the first time in a month last week, posting a 0.9 per cent gain against the dollar, its largest weekly advance in almost two months. That week, it traded in a range of 81.92 to 82.95.
For the current week, the rupee ended little changed at 82.04 on Friday, the report added.
For the week ended March 3, the foreign currency assets, a major component of the reserves, increased $1,181 million to $497.087 billion, according to the RBI’s Weekly Statistical Supplement.
Expressed in dollar terms, the foreign currency assets include the effect of appreciation or depreciation of non-US units like the euro, pound, and yen held in the foreign exchange reserves.
Gold reserves also rose $282 million to $42.033 billion. The Special Drawing Rights (SDRs), however, fell $13 million to $18.174 billion.
The country’s reserve position with the IMF was up $8 million to $5.107 billion in the reporting week, as per the RBI data.
Meanwhile, the rupee pared its initial losses to settle 4 paise higher at 82.02 (provisional) against the US dollar on Friday, tracking the weakness of the American currency in the overseas market.
At the interbank foreign exchange market, the local unit opened at 82.12 against the American currency and finally closed at 82.02 (provisional) against the greenback, registering a gain of 4 paise over its previous close of 82.06.