India’s foreign exchange reserves experienced a notable decline of nearly $10 billion in the week ending June 12, primarily due to a significant drop in gold reserves, as reported by the Reserve Bank of India.
Illustration: Dado Ruvic/Reuters
Key Points
- India’s forex reserves dropped by $9.985 billion to $671.62 billion for the week ending June 12.
- The significant decline was primarily attributed to a sharp decrease in the value of gold reserves.
- Gold reserves fell by $10.75 billion to $103.82 billion during the reporting week.
- Foreign currency assets, a major component, saw an increase of $846 million to $544.29 billion.
- Special Drawing Rights (SDRs) and India’s reserve position with the IMF also experienced minor declines.
India’s forex reserves dropped $9.98 billion to $671.62 billion during the week ended June 12 due to sharp drop in gold reserves, the RBI said on Friday.
In the previous reporting week, the overall reserves had dropped $711 million to $681.61 billion.
Components of Forex Reserves
For the week ended June 12, foreign currency assets — a major component of the reserves — increased $846 million to $544.29 billion, the data released by the Reserve Bank of India (RBI) showed.
Expressed in dollar terms, the foreign currency assets include effects of appreciation or depreciation of non-US units, such as the euro, pound, and yen, held in foreign exchange reserves.
Impact of Gold Reserves
However, the value of gold reserves decreased $10.75 billion to $103.82 billion during the week, the RBI said.
The special drawing rights (SDRs) were down $66 million to $18.7 billion, the apex bank said.
India’s reserve position with the IMF were down $11 million to $4.81 billion in the reporting week, according to the apex bank’s data.