According to the RBI's weekly statistical supplement published last week, India's foreign exchange reserves increased by $6. 6 billion to $531.1 billion in the week ending October 28. This was the largest weekly increase since September 2021. Dealers suggested that several factors, including the central bank getting dollars that it had previously purchased on forward markets, could account for the surge. Of late, the RBI’s intervention has been largely to support the rupee and ensure that it does not depreciate sharply.
The country’s reserves were $524. 5 billion at the end of the previous week that ended October 21. Reserves have declined around 16% this year so far due to the RBI’s intervention in the currency markets, as well as valuation changes owing to the dollar’s strength. The rupee increased during the holiday-shortened week that concluded on October 28 to halt a run of six weeks of falls. For the current week, it closed flat at 82. 44 per dollar, gaining 45 paise over last Thursday’s close of 82. 89.
Due to ongoing foreign capital inflows and a weaker dollar outside, the rupee strengthened. The local section of the interbank foreign exchange market opened at 82. 85 and increased to 82 as the day's high during the session. It finally settled at 82. 44 against the dollar.
Special drawing rights (SDRs) increased to $17.6 from $185 million. Additionally, the nation's reserve position with the IMF increased by $48 million to $4. 8 billion in the reporting week, according to figures from the apex bank.
