India’s forex reserves rose to over $2 billion after three consecutive weeks of falling for the week ended June 24 as the dollar declined against most major currencies while the rupee continued to fall to new record lows. .
According to the weekly supplementary data of the Reserve Bank of India, the country’s foreign exchange reserves rose by $2.735 billion to $593.323 billion for the week ended June 24, from $590.588 billion in the previous week.
While the rupee hit a series of all-time lows against the dollar during the week, the greenback’s attractiveness was somewhat lower than that of its major peers that week, as investors redefined inflation and a weak demand outlook. But took the risk of increasing the rates.
This has increased the country’s import cover.
According to RBI, for the week ended June 24, foreign exchange assets (FCAs), a significant part of total reserves, rose by $2.334 billion to $529.216 billion and gold reserves rose by $342 million to $40.926 billion.
The FCA, expressed in dollar terms, takes into account the effect of appreciation or depreciation of non-US currencies held in foreign exchange reserves such as the euro, sterling and yen.
However, the dollar has regained its dominance, and the rupee’s fall to lifetime lows continues unabated. Therefore, the country’s import war chest risks still more downward sloping.