India's Forex Reserves Drop By $2.17 Billion To $584.74 Billion: RBI

In October 2021, India's forex kitty had reached an all-time high of $645 billion

India's forex reserves dropped by a further $2.166 billion to $584.742 billion for the week ended October 6, the RBI said on Friday. India's forex kitty had gone down by $3.794 billion to $586.908 billion in the previous week. It can be noted that in October 2021, the country's forex kitty had reached an all-time high of $645 billion. The reserves took a hit as the central bank deployed the kitty to defend the rupee amid pressures caused majorly by global developments since last year.

For the week ended October 6, the foreign currency assets, a major component of the reserves, decreased by $707 million to $519.529 billion, according to the Weekly Statistical Supplement released by the RBI.

Expressed in dollar terms, the foreign currency assets include the effect of appreciation or depreciation of non-US units like the euro, pound and yen held in the foreign exchange reserves.

Gold reserves were down by a sharp $1.425 billion to $42.306 billion, the RBI said. The Special Drawing Rights (SDRs) were down by $15 million to $17.923 billion, the apex bank added.

India's reserve position with the IMF was also down by $19 million to $4.983 billion in the reporting week, the central bank data showed. 

Rs 2,000 Notes Exchange

Meanwhile, with banks stopping accepting Rs 2,000 notes, people have started queuing up at 19RBI offices to exchange the high denomination currency, which was withdrawan from circulation. On May 19, the RBI had surprised all by announcing its intent to withdraw the Rs 2,000 note introduced in 2016 for quick remonetisation, following Prime Minister Narendra Modi's announcement to suck out over 88 per cent of currency in circulation by banning the Rs 500 and Rs 1,000 notes.

Public and entities holding such notes were initially asked to either exchange or deposit them in bank accounts by September 30. The last date was later extended to October 7. The deposit as well as exchange facilities at bank branches was stopped on October 7. From October 8, people were given the option to get the currency exchanged or get the amount credited in their banks accounts at 19 offices of the RBI.