Depreciating Rupee
FX reserves fall to 4-mo low of $657.89 bln, post biggest weekly fall ever
This story was originally published at 19:38 IST on 22 November 2024
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--RBI: India Nov 15 FX reserves $657.89 bln, down $17.76 bln on week
--India's FX reserves post biggest weekly fall ever in week ended Nov 15
NEW DELHI – India's foreign exchange reserves posted their biggest weekly fall on record to an over four-month low of $657.89 billion in the week ended Nov. 15, as the central bank kept up with its dollar sales intervention to prevent a sharp depreciation in the Indian unit. The reserves fell by $17.76 billion during the week, declining for the seventh time in a row, data released by the Reserve Bank of India on Friday showed.
The foreign exchange reserves have now declined by $47 billion from the record high of $704.89 billion hit in late September. "Forex reserves fell as the RBI met the FII (foreign institutional investors) selling and importers' demand (of dollars)," said Dilip Parmar, currency analyst at HDFC Securities.
The rupee remained unperturbed in the week ended Nov. 15, in the face of strong foreign portfolio outflows, as the central bank actively intervened in the spot market through dollar sales. FPIs have net sold domestic stocks and bonds worth almost $4 billion in November so far, after pulling out $11.1 billion in the previous month.
The reserves also declined due to revaluation losses after a jump in US Treasury yields and the US dollar during the period. The dollar index strengthened 1.6% in the week ended Nov. 15, while US Treasury yields rose 13 basis points. Calculated in dollar terms, the foreign currency reserves also reflect the impact of appreciation or depreciation of non-US units like the euro, the pound and the yen held in the reserves.
Foreign currency assets fell by $15.55 billion to $569.84 billion as of Nov. 15. The portion of gold in the reserves also fell by $2.07 billion to $65.75 billion.
End
US$1 = INR 84.45
Reported by Pratiksha
Edited by Akul Nishant Akhoury
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