India’s forex reserves at 2-year low in the midst of depreciating rupee

India’s foreign exchange reserves dropped by USD 4.5 billion from the previous week to a more than two-year low of USD 528.367 billion for the week ending on October 14.

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India’s foreign exchange reserves dropped by USD 4.5 billion from the previous week to a more than two-year low of USD 528.367 billion for the week ending on October 14.

The country’s foreign exchange reserves were USD 532.868 billion in the previous week, according to data from the RBI.

The largest component of India’s foreign exchange reserves, its foreign currency assets, decreased by USD 37.453 billion during the course of the week, according to figures from the RBI.

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According to the RBI statistics, the value of India’s Special Drawing Rights (SDRs) with the IMF decreased by USD 149 million to USD 17.433 billion during the week under review.

Earlier on Wednesday, the rupee crossed the 83 mark against the US Dollar for the first time in its history.

According to the market date which revealed that, so far this year, the rupee has depreciated around 11-12 %.

In order to stop a sharp depreciation of the rupee, the RBI typically intervenes in the market through liquidity management, including by selling dollars.

India’s foreign exchange reserves continued to fall by almost USD 100 billion. Following the Russian invasion of Ukraine in late February, when imports of energy and other basic commodities became more expensive all over the world.