Gold, asset devaluation pulls India’s forex reserve down by $2.597 bn

Mumbai, March 25 (IANS) Devaluation of gold and other asset classes pulled India’s foreign exchange reserves lower by $2.597 billion during the week that ended on March 18.

Reserve Bank of India data showed that India’s forex reserves fell to $619.678 billion from $622.275 billion reported for the previous week.

The country’s forex reserves consist of foreign currency assets (FCAs), gold reserves, SDRs, and the country’s reserve position with the IMF.

On a weekly basis, FCAs, the largest component of the forex reserves, edged lower by $703 million to $553.656 billion. Similarly, the value of the country’s gold reserves decreased by $1.831 billion to $42.011 billion, while the SDR value fell by $62 million to $18.865 billion.

On the other hand, the country’s reserve position with the IMF remained flat at $5.146 billion.

“India’s FX reserves decreased by $2.60 billion to $619.68 billion in the week ending 18th March largely due to valuation effects in gold by $1.8 billion and $0.7 billion in foreign currency,” said Sajal Gupta, Head Fx & Rates, Edelweiss.

“The week prior to that, the FX reserves had decreased by $9.65 billion to $622.27 billion.”

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