India’s forex reserves drop for 4th week, fall to over 5-month low

MUMBAI: India’s foreign exchange reserves declined for a fourth straight week to $586.91 billion, the lowest in more than five months, as of Sept. 29, data from the Reserve Bank of India (RBI) showed on Friday.

That was a decrease of $3.8 billion from the previous week. Reserves had fallen by a total of $8.2 billion in the prior three weeks.

The central bank intervenes in the spot and forwards markets to prevent runaway moves in the rupee.

India’s forex reserves are “sizeable” and “very comfortable,” RBI Governor Shaktikanta Das said on Friday, while reiterating that the central bank’s intervention aims to prevent any volatility of the rupee’s exchange rate.

Apart from the central bank’s intervention, changes in foreign currency assets, expressed in dollar terms, include the effects of appreciation or depreciation of other currencies held in the RBI’s reserves.

Foreign exchange reserves include India’s Reserve Tranche position in the International Monetary Fund.

For the week the forex reserves data pertains, the rupee had fallen 0.1% against the dollar and traded in a range of 83.0225 and 83.2450.

The rupee ended at 83.2450 on Friday, down 0.2% for the week.

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FOREIGN EXCHANGE RESERVES (in million U.S. dollars)
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                             Sept. 29,   Sept. 22,
                             2023        2023
 Foreign currency assets     520,236     523,363
 Gold                         43,731      44,307
 SDRs                         17,939      18,012
 Reserve Tranche Position      5,002       5,019
 Total                       586,908     590,702
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