India's forex reserves soar close to $600 bn, hit one-year high
New Delhi, May 21: India's foreign exchange reserves continue to climb, approaching USD 600 billion, a nearly one-year high.
The reserves increased by USD 3.553 billion to USD 599.529 billion in the week ending May 12 for which data is available. Prior to the May 12 week, they increased by USD 7.196 billion to USD 595.976 billion, according to RBI data.
Returning to the latest RBI data, India's foreign currency assets, the largest component of FX reserves, increased by USD 3.577 billion to USD 529.598 billion. During the most recent week, gold reserves increased by USD 38 million to USD 46.353 billion.
The country's foreign exchange reserves reached an all-time high of over USD 645 billion in October 2021.
Much of the fall since then can be attributed to an increase in the cost of imported goods in 2022.
Furthermore, the RBI's intervention in the market to defend the weakening rupee against a surging US dollar had reduced forex reserves significantly.
Typically, the RBI will interfere in the market from time to time through liquidity management, including the selling of dollars, in order to prevent a sharp depreciation of the rupee.
The RBI regularly monitors foreign exchange markets and intervenes only to ensure orderly market conditions by reducing excessive volatility in the exchange rate, without regard for any predetermined target level or band.
- ANI
