MUMBAI (Reuters) – India’s foreign exchange reserves rose for a third straight week and reached a more than two-year high of $636.10 billion as of March 8, data from the central bank showed on Friday.
The reserves jumped by $10.47 billion in the reporting week, the biggest jump since the week ended July 14, 2023.
They had risen by a total of $9.5 billion in the prior two weeks, edging towards their record high of $642.45 billion, hit in September 2021.
The Reserve Bank of India (RBI) intervenes in the foreign exchange market to curb excess volatility in the rupee.
The RBI had bought dollars in the spot market in the reporting week, likely absorbing robust debt and equity inflows, as per traders.
The jump in reserves also came as gold valuation stood at $50.72 billion, up from $48.42 in the prior week.
Gold prices had jumped in the reporting week, and in India, the world’s second-largest gold consumer, domestic prices rose to a record 66,356 rupees per 10 grams on March 8.
Changes in foreign currency assets are caused by the RBI’s intervention as well as the appreciation or depreciation of foreign assets held in the reserves.
Foreign exchange reserves include India’s reserve tranche position in the International Monetary Fund.
In the week that the foreign exchange data pertains, the rupee rose 0.1% against the dollar and traded in a range of 82.7250 and 82.9275.
The domestic currency settled at 82.8775 on Friday, down about 0.1% for the week, its first week-on-week decline since mid-February.
FOREIGN EXCHANGE RESERVES (in million U.S. dollars)
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March 08 March 01
2024 2024
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Foreign currency assets 562,352 554,231
Gold 50,716 48,417
SDRs 18,211 18,180
Reserve Tranche Position 4,817 4,798
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Total 636,095 625,626
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Source text: (https://www.rbi.org.in/scripts/BS_PressReleaseDisplay.aspx)
((India Headline News Team; +91 80 6749 1310))
(Reporting by Siddhi Nayak; Editing by Sohini Goswami)