India’s foreign exchange reserve soar to an 11-month high of $595.9

India’s foreign exchange reserve soar to an 11-month high of $595.9

India’s foreign exchange reserves increased by $7.196 billion in the week ending May 5, 2023, reaching $595.976 billion, which is an 11-month high. This follows a previous rise of $4.532 billion the week before. Foreign currency assets (FCA) saw the most significant growth, rising by $6.536 billion to $526.021 billion during the week.

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India’s foreign exchange reserve soar to an 11-month high of $595.9: Key Points

• Gold reserves rose by $659 million to $46.315 billion, while the reserve position at the International Monetary Fund increased by $139 million to $5.192 billion.
• However, Special Drawing Rights (SDRs) decreased by $204 million to $18.447 billion. The Reserve Bank of India has been intervening in the forex market to curb rupee depreciation through spot and forward positions.
• The Indian rupee recently recorded its worst week since mid-March due to the strength of the US dollar, tepid Chinese economic data, concerns over US fiscal policy, and uncertain interest rates.

How is the Indian currency standing in the international market?

• The Indian currency has been trading weakly within the range of 82.08-82.22 and hovering around 82.15 due to the added economic pressure from the US debt crisis.
• Despite efforts to surpass 82.00, the rupee has been unsuccessful and is now awaiting the Karnataka election results, which will be closely monitored by market participants.

The analyst predicts that the rupee’s range will fall between 81.95-82.25 and a break on either side will determine its clear trend.

Also Read: Retail Inflation Sees Significant Drop in April, Hits 4.7%

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