More Stories

Informist, Friday, Oct. 4, 2024

 

--RBI: India Sept 27 FX reserves $704.89 bln, up $12.59 bln on week 

--RBI: India Sept 27 FX assets $616.15 bln, up $10.47 bln on week 

--India FX reserves top $700 bln, rise to all-time high of $704.89 bln 

 

MUMBAI – India's foreign exchange reserves rose to a fresh record high and crossed the $700-billion mark in the week ended Sept. 27, data released by the Reserve Bank of India on Friday showed. According to the central bank's data, India's foreign exchange reserves rose by $12.59 billion last week--the most since mid-July 2023--to $704.89 billion as of Sept. 27. The foreign exchange reserves have increased seven weeks in a row.

 

So far in 2024, India's foreign exchange reserves have risen by $81.68 billion compared to an increase of $60.35 billion in the whole of 2023. The rise in reserves can be attributed to a combination of RBI's dollar purchases and rise in valuations due to a fall in US Treasury yields and higher gold prices, Gaura Sen Gupta, chief economist at IDFC FIRST Bank, said. Of the total increase, $7.8 billion was through market purchases and $4.8 billion through valuation gains, Sen Gupta said.

 

Market participants cited the RBI's measures to contain volatility in the dollar/rupee exchange rate as one of the reasons behind the rise in the foreign exchange reserves. "It shows in the orderly behaviour of INR under such volatility," said Alok Singh, group head - treasury at CSB Bank. "FPI (foreign portfolio investors) profit booking across asset classes would have made (rupee) much more volatile had the RBI not intervened for an orderly depreciation (of the rupee)."

 

In the week ended Sept. 27, the rupee touched a two-and-a-half month high of 83.4350 a dollar, prompting dollar purchases by the RBI, according to market participants. They added that gains in valuations of other assets also led to an increase in the reserves, with the value of RBI's gold holdings up $2.18 billion in the week ended Sept. 27 to $65.80 billion.

 

With the rupee falling this week and hovering near the psychologically important 84-a-dollar mark, market participants don't expect the foreign exchange reserves to rise sharply again when data on the same is released by the RBI on Oct. 11. According to foreign exchange market players, the central bank likely sold around $4 billion this week to prevent the rupee from falling sharply. It fell 27 paise this week to close at 83.9725 a dollar on Friday.  End

 

Reported by Sourabh Kumar and Kabir Sharma

Edited by Ashish Shirke

 

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

 

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

 

Informist Media Tel +91 (22) 6985-4000

Send comments to feedback@informistmedia.com

 

© Informist Media Pvt. Ltd. 2024. All rights reserved.