Forex Reserves Rise $4.532 Billion To $588.78 Billion, At A 10-Month High: RBI Data

According to RBI’s Weekly Statistical Supplement, for the week ended April 28, foreign currency assets, a major component of the reserves, increased nearly $5 billion to $519.485 billion. 

The Reserve Bank of India data on Friday showed that India’s foreign exchange reserves rose by $4.53 billion to $588.78 billion in the week ended April 28. In the previous reporting week, the overall reserves had dropped $2.164 billion to $584.248 billion. 

According to Bussines Standard, foreign exchange reserves rose to a 10-month high level with the previous high being $588.31 billion in the week ended July 1, 2022. 

In April, the overall reserves rose by $10.31 billion, RBI data showed.  

According to RBI’s Weekly Statistical Supplement, for the week ended April 28, foreign currency assets, a major component of the reserves, increased nearly $5 billion to $519.485 billion. 

Foreign Currency Assets (FCAs) are held in diverse currencies like the US dollar, Euro, pound sterling, Australian dollar, etc. An appreciation in the value of the US dollar against major international currencies translates into a lower US dollar equivalent for assets held in other currencies. 

Gold reserves dropped $494 million to $45.657 billion in the reporting week, the RBI said.

The Special Drawing Rights (SDRs) rose $35 million to $18.466 billion, The country's reserve position with the IMF was down $4 million to $5.172 billion in the reporting week. 

The country's reserves of foreign currency hit an all-time high of $645 billion in October 2021. The reserves have been decreasing as the central bank has utilised its funds to support the rupee against pressure from international events. 

Forex reserves are essential assets maintained in foreign currencies by the central bank. They frequently support the exchange rate and have an impact on monetary policy. The RBI intervenes in the spot and forwards markets to stop the rupee from making unpredictable movements that have an impact on the overall reserves position. Forex changes also occur from valuation gains or losses.