India’s Forex reserves lose shine as gold prices plummet

Mumbai, Jan 14 (IANS) A decline in international gold prices plunged India’s foreign exchange (Forex) reserves by $1.14 billion during the week ended January 6.

According to the Reserve Bank of India’s weekly statistical supplement, the overall Forex reserves decreased to $359.15 billion.

The overall foreign exchange reserves had risen by $625.5 million to touch $360.29 billion for the week ended December 30.

In contrast, the foreign currency assets (FCA), which is the largest component of India’s Forex reserves, increased by $241.8 million to $336.82 billion during the week under review.

Apart from the US dollar, the FCA consists of nearly 20-30 percent of other non-US dollar major global currencies, securities and bonds.

The individual movements of these currencies against the US dollar impacts the overall foreign reserves value.

However, the country’s gold reserves plunged by $1.39 billion to $18.58 billion. The reserves were stagnant at $19.98 billion during the week ended December 30.

During the month of December prices of gold declined by 1.7 per cent in US dollar terms.

On the other hand, the special drawing rights (SDRs) gained by $5.7 million to $1.43 billion.

The country’s reserve position with the IMF (International Monetary Fund) edged higher by $9.4 million to $2.30 billion.

–IANS

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