India’s Forex Reserves Reach Seven-Week High To $590.78 Billion

India's foreign exchange reserves rose by $4.67 billion to $590.78 billion for the week ending November 3, according to the latest Reserve Bank of India (RBI) data released Friday.

Earlier, forex reserves witnessed an increase of $2.6 billion to $586.5 billion for the week ending on October 27.
As per the Weekly Statistical Supplement released by the central bank, Foreign currency assets (FCAs) grew by $4.39 billion to $521.9 billion. Expressed in dollar terms, the FCAs 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 rose by $200 million to $46.12 billion, while SDRs rose by $64 million to $17.98 billion. Reserve position in the IMF stood at $4.79 billion, up $16 million.

It is worth mentioning that in October 2021, India's forex kitty reached its highest-ever level at $645 billion. There has been a decline in reserves have been declining as the central bank deploys the kitty to protect the Indian Rupee amidst pressures caused mostly by global developments. Usually, the RBI, intervenes in the market from time to time through liquidity management, including through the selling of dollars to prevent a steep depreciation in the rupee.

RBI Governor, Shaktikanta Das, said on Thursday that India's current account deficit (CAD) is "eminently manageable". The RBI has upped its forex reserve to deal with potential eventualities. Foreign exchange reserves are also associated with India's reserves tranche position in the International Monetary Fund (IMF).

During the week, the domestic unit depreciated to a record low of 83.2950 against the US dollar. The local currency ended at 83.34 against the US Dollar on Friday.