India's forex reserves down $0.76 billion

Mumbai, June 30 (IANS) India's foreign exchange reserves (forex) fell by $0.76 billion to $288.62 billion for the week ended June 22, official data showed.

The RBI is believed to have been selling dollars during the week to curb the slide in the rupee's value. Incidentally, the rupee gained strength Friday - a gain of two percent over Thursday's close of Rs.56.81 to a dollar, at Rs.55.64.

Over the week, the partially convertible rupee slumped to an all-time low of 57.33 against the US dollar.

It has weakened sharply in the last two months due to ultra high current accounts deficit due to increased demands from oil importers and outflow of money by the foreign institutional investors (FIIs), as poor gross domestic product (GDP) growth data dampened sentiment in the Indian markets.

The forex had recovered in the week ended June 15 when it grew by $2 billion to $289.39 billion and in the week ended June 8, when it recovered by $1.52 billion to $287.37 billion after falling for five straight weeks.

The reserves had plunged by $2.40 billion to $285.85 billion for the week ended June 1, apparently due to the Reserve Bank of India (RBI) selling dollars to defend the rupee.

The reserves had also declined by $1.74 billion and $1.80 billion respectively in the previous two weeks before June 1.

Foreign currency assets, the biggest component of the forex reserves kitty for the week ended June 22, dwindled by $0.74 billion to $255.78 billion, according to the RBI's weekly statistical supplement.

The RBI did not provide any reasons for the fall in the foreign currency assets.

It said the assets expressed in US dollar terms included the effect of appreciation or depreciation of non-US currencies such as the pound sterling, euro and yen held in reserve.

The value of gold reserves remained the same during the week under review at $25.58 billion. The value had declined in the week ended June 1 by $1.03 billion to $25.58 billion.

The value of special drawing rights (SDRs) also fell by $14.8 million to $4.37 billion and India's reserves with the International Monetary Fund (IMF) dwindled by $9.8 million to $2.88 billion.