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India’s foreign exchange reserves fell by $7.5 billion to $572 billion during the week ended July 15, according to data released by the Reserve Bank of India (RBI).
Reserves fell to a 20-month low following heavy intervention by the central bank in the forex market as it sold dollars to prevent a sharp depreciation of the rupee, reports the Times of India.
The Indian forex reserves were last at $572 billion in November 2020. Since then, they had risen to a high of $642 billion in October 2021. The RBI is believed to have sold over $50 billion to stem the volatility in the foreign exchange market.
In the interbank foreign exchange market, the rupee closed 10 paise stronger at 79.85 as against Thursday’s close of 79.95. The rupee firmed up even as foreign institutional investors were net sellers in the equity market on Friday.
The dollar index, which measures the greenback’s strength against a basket of six currencies, was up 0.2% at 107.1.
Former chief statistician of India Pronab Sen told the Times of India: “It is more of a story of the dollar strengthening than the rupee weakening.”
(DT)
