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India’s forex reserves hit the lowest level in 23 months

Mumbai: India’s foreign exchange (forex) reserves slumped by $7.941 billion to $553.105 billion for the week ended September 2, the lowest level in almost two years, the Reserve Bank of India (RBI) data showed.

This is the fifth weekly fall in the country’s forex reserves. The forex reserves had dipped by $3.007 billion for the week ended August 26 and by $6.687 billion in the previous week.

The country’s foreign exchange reserves have declined sharply in recent months as the RBI continues to intervene in the currency markets to defend the rupee.

As per the Reserve Bank of India’s weekly statistical supplement, foreign currency assets, which are the biggest component of the forex reserves, dropped by $6.527 billion to $492.117 billion during the week ended September 2. The foreign currency assets had declined by $2.571 billion and $5.779 billion in the previous two weeks respectively.

Expressed in US dollar terms, the foreign currency assets include the effect of appreciation or depreciation of non-dollar currencies like Euro, UK’s Pound Sterling and Japanese Yen held in the foreign exchange reserves.

All components of the forex reserves declined during the week under review.

The value of gold reserves dipped by $1.339 billion to $38.303 billion during the week ended September 2.

The value of India’s Special Drawing Rights (SDRs) with the International Monetary Fund declined by $50 million to $17.782 billion during the week under review, the RBI data showed.

India’s reserve position in the International Monetary Fund (IMF) declined by $24 million to $4.902 billion during the week ended September 2, as per the RBI Weekly Statistical Supplement.