Indian Foreign Exchange Reserves increased by $2.063 billion
The data from the Reserve Bank of India (RBI) shows that the Foreign Exchange Reserves of India increased by $2.063 billion to $400.24 billion in the week to February 1. The foreign exchange reserves had increased by USD 1.497 billion to reach USD 398.178 billion in the previous week corresponding to January 25. The increase in the value of the Foreign Exchange Reserves is attributed to the increase in foreign currency assets.
India’s Forex Reserves
The components of India’s Forex reserves are:
- The Foreign Currency Assets which forms a major component of the overall reserves increased by $1.280 billion to $373.430 billion. Foreign currency assets expressed in USD are subjected to the effects of appreciation or depreciation of non-US currencies such as the euro, pound and yen held in the reserves.
- In the reporting week, the gold reserves also increased by $764.9 million to $22.686 billion.
- India’s special drawing rights with the International Monetary Fund (IMF) rose by $6.2 million to $1.470 billion.
- India’s reserve position with the IMF also increased by $11.2 million to $2.654 billion.
Foreign Exchange Reserves are used to back liabilities on their own issued currency as well as to influence monetary policy. These reserves act as a buffer during the challenging times to the economy.