India’s forex kitty had jumped $3.553 billion to $599.529 billion for the week ended May 12.
Expressed in dollar terms, the foreign currency assets (FCAs) include the effect of appreciation or depreciation of non-US units like the euro, pound and yen held in the foreign exchange reserves. India’s total FCA saw a dip of $4.654 billion to $524.945 billion.
Gold reserves fell by $1.227 billion to $45.127 billion while SDRs fell by $137 million to $18.276 billion.
India’s reserve position in the IMF saw a dip of $35 million to $5.130 billion.
The Indian rupee rose on Friday and snapped two straight weeks of losses as persistent dollar inflows into equities helped offset the impact from a broadly strong dollar. The rupee ended up 0.2% to 82.5750 versus the U.S. dollar. The currency has recovered from a near three-month low of 82.85 hit earlier in the week. The rupee ended up 0.1% for the week.
It can be noted that in October 2021, the country’s forex kitty had reached an all-time high of USD 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.India has a strong foreign exchange reserve and the country is in a comfortable position to meet all the requirements even in any worst-case scenario in the next five-six years, Commerce and industry Minister Piyush Goyal said earlier this week.
On forex reserves, he said: “We have strong foreign exchange reserves… In the worst case with whatever difficulty anybody may have, India is comfortable for the next 5 or 6 years, given our forex reserves today, to be able to meet our forex requirements.”
(With agency inputs)