India’s forex reserves continue to decline

The country’s foreign exchange reserves continue to decline. In the week ended September 23, it declined by $ 8.134 billion to $ 537.518 billion. This is the eighth consecutive week that forex reserves have declined.

The forex reserves have come down for the week ended 23 September due to fall in Foreign Currency Assets (FCA). FCAs form a major part of the overall reserves. According to RBI, during this period, FCA declined by $ 7.688 billion to $ 477.212 billion.

In dollar terms, FCAs include the effect of appreciation or depreciation in non-US currencies such as the euro, pound and yen held in foreign exchange reserves.

Let us tell you that the change in exchange rate has contributed 67 percent of the decrease in foreign exchange reserves since April in the current financial year. The change was witnessed due to the strengthening of US currency dollar and rise in US bond returns.

Significantly, in the current financial year, the rupee has depreciated sharply against the US dollar.

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