India’s Forex Reserves: The country’s foreign exchange reserves are decreasing. India’s foreign exchange reserves have declined by $ 5.69 billion to reach $ 634.58 billion in the week ending January 3. Reserve Bank of India has given this information. RBI said on Friday that in the previous week it had decreased by $ 4.112 billion to $ 640.279 billion.
This decline has been coming for the last few weeks
The country’s foreign exchange reserves have been declining for the last few weeks. The reason behind this is the Reserve Bank’s effort to control the weakening of the Indian currency against the dollar. For this, the Reserve Bank intervenes in the foreign exchange reserves and also does its revaluation.
Foreign exchange reserves are also called foreign exchange reserves or forex reserves. At the end of September last year, the country’s foreign exchange reserves had increased to an all-time high of $ 704.885 billion.
According to the data released on Friday, foreign currency assets, a major part of the foreign exchange reserves, declined by $ 6.44 billion to $ 545.48 billion in the week ending January 3. Foreign currency assets also include the impact of fluctuations in non-US currencies such as the euro, pound and yen held in foreign exchange reserves.
Country’s gold reserve increased
The Reserve Bank also informed that during the same week the country’s gold reserve increased by $ 824 million to $ 67.092 billion. RBI also informed that Special Drawing Rights (SDR) have decreased by 58 million dollars to 17.815 billion dollars. According to Reserve Bank data, India’s reserves with the International Monetary Fund (IMF) have declined to $ 4.199 billion in the week ending January 3.
Why is it important to keep foreign exchange reserves full?
It is noteworthy that it is important that the foreign exchange reserves, which are called the meter of economic health of the country, should always remain full. Due to its decrease the country has to face many problems. There is difficulty in paying the bills for import of goods and services, there is problem in repayment of loans taken from abroad. Due to its decrease, the currency of the country also starts falling. Although the foreign exchange reserves include the currencies of many countries, the dollar is the largest in it because most of the trade in the world is done in US dollars only.
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