At $729 billion, forex kitty hits a record
Reserves increased $12.4 billion during the week, with foreign currency assets increasing $9.4 billion to $591 billion, while the value of gold reserves rose by $2.8 billion to $114 billion. Forex reserves last touched a high of $728 billion late February this year. As of August 21, Indian banks have mobilised $65.4 billion in foreign currency non-resident (FCNR-B) deposits under the Reserve Bank…
India's foreign exchange reserves have reached a record high of $729.3 billion, according to data released on August 21. The significant increase of $12.4 billion within the week was driven by banks' efforts to mobilize non-resident Indian (NRI) deposits under the central bank's concessional swap window, which closes on August 31. Foreign currency assets surged by $9.4 billion, reaching $591 billion, while gold reserves rose by $2.8 billion, amounting to $114 billion.
The previous record high of $728 billion was last reached late February this year. Indian banks have successfully mobilized $65.4 billion in FCNR-B deposits under the RBI's special forex swap facility, contributing to the total foreign exchange inflows of $72.85 billion through this specific window. The RBI reported that this inflow reached $72 billion in the scheme's announcement on June 5.
While the entire $72 billion in gross inflows may not be fully reflected in India's foreign exchange reserves, some of the dollar flows could be utilized by the central bank for supporting the rupee through spot market intervention. Additionally, a portion might be allocated to reducing the RBI's outstanding forward liabilities. As of June 30, the net short forward positions of the RBI stood at $104 billion.
Written by urgent.news from The Economic Times - Economy's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
