The country's foreign exchange reserves declined by $5.4 billion to $643.16 billion in the past week, the first time since remaining stable for eight weeks ended April 12.
Latest data showed that foreign currency assets (FCA) declined by $3.7 billion to $560.86 billion, while gold reserves which form part of foreign exchange reserves increased by $1.01 billion to $56.81 billion, while SDRs fell by $43 million. Decreased to $18.03. Arab.
Market analysts attribute the decline in foreign currency assets to the RB's active release of dollars into the market to curb rupee volatility.
The Indian currency has weakened as oil prices have risen, leading to increased demand for dollars to finance expensive imports.
The decline in the foreign currency portion of the reserves has been offset by the increase in the value of gold assets held by the RBI.
Central banks have been buying gold as safe-haven investments in recent months amid geopolitical uncertainties arising from the Middle East conflict.
RBI Governor Shaktikanta Das earlier this month had described the record foreign exchange reserves as a reflection of the strength of the Indian economy.
"Our main focus is on creating a strong buffer in the form of adequate amount of foreign exchange reserves, which will help us if the cycle turns or there are heavy rains," he said while unveiling the first monetary policy review of the current fiscal year. Which started from 1st April.
India's foreign exchange reserves, including the central bank's forward holdings, cannot cover nearly 11 months of imports, the highest level in two years.
Latest data showed that foreign currency assets (FCA) declined by $3.7 billion to $560.86 billion, while gold reserves which form part of foreign exchange reserves increased by $1.01 billion to $56.81 billion, while SDRs fell by $43 million. Decreased to $18.03. Arab.
Market analysts attribute the decline in foreign currency assets to the RB's active release of dollars into the market to curb rupee volatility.
The Indian currency has weakened as oil prices have risen, leading to increased demand for dollars to finance expensive imports.
The decline in the foreign currency portion of the reserves has been offset by the increase in the value of gold assets held by the RBI.
Central banks have been buying gold as safe-haven investments in recent months amid geopolitical uncertainties arising from the Middle East conflict.
RBI Governor Shaktikanta Das earlier this month had described the record foreign exchange reserves as a reflection of the strength of the Indian economy.
"Our main focus is on creating a strong buffer in the form of adequate amount of foreign exchange reserves, which will help us if the cycle turns or there are heavy rains," he said while unveiling the first monetary policy review of the current fiscal year. Which started from 1st April.
India's foreign exchange reserves, including the central bank's forward holdings, cannot cover nearly 11 months of imports, the highest level in two years.
