India’s Forex Reserves Rise to $573.73 Billion in January

India’s Forex Reserves Rise to $573.73 Billion in January

The foreign exchange reserves of India rose above a six-month high of $576.76 billion in the week through January 27, said the Reserve Bank of India’s (RBI) statistical supplement on February 3.

According to the Weekly Statistical Supplement released by the RBI, forex reserves rose by $3.03 billion during the week ending January 27. This is the third consecutive week that the country’s reserves have risen. In the week to January 20, the reserves stood at $573.73 billion.

The uptick in the foreign exchange reserves is a result of the rise in the Foreign Currency Assets (FCA), which is a major component of the overall reserves. The FCA increased $2.66 billion to $509.02 billion for the week ending January 27. The gold reserves increased $316 million to $44.03 billion. The Indian rupee ended at 81.83 against the US Dollar on February 3.

The dollar appreciated against several currencies, including the rupee, last year. While the rupee has been one of the better-performing currencies worldwide, the modest depreciation it experienced may have added to the domestic inflationary pressures and widened the Current Account Deficit. The currency also touched record low levels and breached the 83-mark for the first time last year. In response, the RBI spent forex reserves to cushion the fall.