India's Forex Reserves Dip By $3.5 Billion From Peak
The reserve pile had recovered after hitting a low of $524.5 billion in October 2022.
India's foreign exchange reserves declined to $667 billion for the week ended July 26, the Reserve Bank of India data showed on Friday. The forex kitty fell by $3.5 billion over the previous reporting week, reversing a three-week trend of increase.
The reserve pile had recovered after hitting a low of $524.5 billion in October 2022 as the central bank replenished its kitty amid solid overseas inflows.
Foreign investors have pumped in Rs 1.4 lakh crore into the country's debt and equity markets so far this year, according to data from the National Securities Depository Ltd. The capital flow has largely gone into the domestic debt market, thanks to India's inclusion in the JPMorgan Global Emerging Market Bond Index.
July has seen Rs 22,363 crore and Rs 32,365 crore make its way into Indian bonds and equities, respectively.
For the week-ended July 26, foreign currency assets—a major component of the reserves—fell by $1.17 billion to $586.8 billion, RBI data showed.
In dollar terms, foreign currency assets include the effect of the appreciation or depreciation of non-US units like the euro, pound and yen held in foreign exchange reserves.
Gold reserves declined by $2.3 billion to nearly $57.7 billion during the week.
India remains the fourth-highest foreign exchange reserve holder in the world. The reserves are equivalent to around 11 months of imports projected for fiscal 2025 and about 99% of total external debt outstanding at the end of March, the central bank said in its July bulletin.
