India’s forex reserves rise $1.9 billion to $595 billion

India's foreign exchange reserves saw an uptick of $1.9 billion, taking the overall level to $595.1 billion as on June 30, Reserve Bank of India data showed Friday.

Foreign currency assets (FCAs) rose by $2.5 billion to $528 billion, according to the Weekly Statistical Supplement released by the RBI. Expressed in dollar terms, the FCAs include the effect of appreciation or depreciation of non-US units like the euro, pound and yen held in the foreign exchange reserves.

Gold reserves dropped by $472 million to $43.8 billion, the RBI said.

The country's reserve position with the IMF was down $118 million to $5 billion in the reporting week, the apex bank data showed.

It can be noted that in October 2021, the country's forex kitty had reached an all-time high of USD 645 billion. The reserves have been declining as the central bank deploys the kitty to defend the rupee amid pressures caused majorly by global developments.

Typically, the RBI, from time to time, intervenes in the market through liquidity management, including through the selling of dollars, with a view to preventing a steep depreciation in the rupee.

The RBI closely monitors the foreign exchange markets and intervenes only to maintain orderly market conditions by containing excessive volatility in the exchange rate, without reference to any pre-determined target level or band.