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Forex reserves fall for second straight week

By Religare
|

India's foreign exchange reserves fell for a second week on the trot led by a decline in the value of foreign currency assets, hit by a strengthening dollar, clouding the outlook for Asia's third biggest economy amidst heightened global economic uncertainty including likely US monetary tightening later this year and turmoil in China.

Forex reserves declined by USD 113.5 million to USD 353.347 billion in the week ended August 7, 2015, the Reserve Bank of India (RBI) said on Friday.

 

In the week ended July 31, 2015, the country's foreign exchange reserves dropped by USD 187.6 million to USD 353.46 billion from the prior week.

Foreign currency assets, which are expressed in dollar terms and include the effect of appreciation or depreciation of non US currencies such as euro, pound and yen held in reserves, fell by USD 78.2 million to USD 329.797 billion in the week ended August 7, 2015 from the previous week, the RBI added.

Foreign currency assets are the biggest component of the overall forex reserves.

India's gold reserves stood unchanged at USD 18.250 billion in the week ended August 7, 2015 from the previous week, data showed.

A robust forex reserves kitty is essential for India amidst any possible volatility in global capital flows on account of the impending Fed rate hike and uncertainty in China and Europe.

Story first published: Monday, August 17, 2015, 9:40 [IST]
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