India’s forex reserves jumped $2.35 billion to $596.098 billion for the week ended June 16, according to the latest RBI data. The overall reserves had dropped by $1.318 billion to $593.749 billion in the previous reporting week.
It can be noted that in October 2021, the country’s forex kitty had reached an all-time high of $645 billion. The reserves have been declining as the central bank deploys the kitty to defend the rupee amid pressures caused majorly by global developments.
For the week ended June 16, the foreign currency assets, a major component of the reserves, increased by $2.578 billion to $527.651 billion, according to the Weekly Statistical Supplement released by the RBI on Friday.
Expressed in dollar terms, the foreign currency assets include the effect of appreciation or depreciation of non-US units like the euro, pound and yen held in the foreign exchange reserves.
Gold reserves dropped by $324 million to $45.049 billion, the RBI said. The Special Drawing Rights (SDRs) were up by $62 million to $18.249 billion, the central bank said.
The country’s reserve position with the IMF was up by $34 million to $5.149 billion in the reporting week, the apex bank data showed.
The Rupee Movement
In the week ended June 23, the Indian rupee opened the week at 81.94 and remained range bound within a range of 81.89 to 82.1725 as inflows from stake sales by different companies to foreign entities were absorbed by RBI buying dollars at 81.87 and then 81.90 levels. The RBI parked these dollars forward by paying in premiums which rose by 10 bps.
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Anil Kumar Bhansali, head (treasury) and executive director of Finrex Treasury Advisors LLP, said, “The rupee is expected to remain in the range of 81.90 to 82.40 next week as in-flows dominate and RBI absorbs the in-flows. Since most currencies have fallen, a fall in the rupee is inevitable on Monday. However, unless oil companies step in we should not see a big downside for the rupee. The range of 81.60 to 82.90 on the rupee needs to be respected by buying dollars at the lower end and selling dollars at the upper end.”
(With Inputs from PTI)
first published: June 24, 2023, 09:33 IST
last updated: June 24, 2023, 09:33 IST
