India's Forex Reserves Declined USD 1.32 Bn Last Week To USD 593.75 Bn

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New Delhi: India's overall foreign exchange reserves declined USD 1.318 billion to USD 593.749 billion in the week that ended on June 9, 2023, data released by the Reserve Bank of India on Friday showed. India's foreign currency assets, the biggest component of the forex reserves, declined by USD 1.128 billion to USD 525.073 billion, data showed.

Gold reserves during the week declined by USD 183 million to USD 45.374 billion. Prior to June 9 week, India's total reserves rose by USD 5.929 billion to USD 595.067 billion. ()

In October 2021, the country's foreign exchange reserves touched an all-time high of about USD 645 billion. Much of the decline since then can be attributed to a rise in the cost of imported goods in 2022. ()

Also, the forex reserves had fallen largely because of the RBI's intervention in the market to defend the depreciating rupee against a surging US dollar.

Typically, the RBI, from time to time, intervenes in the market through liquidity management, including through the selling of dollars, with a view to preventing a steep depreciation in the rupee.

The RBI closely monitors the foreign exchange markets and intervenes only to maintain orderly market conditions by containing excessive volatility in the exchange rate, without reference to any pre-determined target level or band.