India's foreign exchange reserves drop to seven-week low

FILE PHOTO: A Reserve Bank of India (RBI) logo is seen inside its headquarters in Mumbai

MUMBAI (Reuters) - India's foreign exchange reserves fell for a third consecutive week and stood at a seven-week low of $637.92 billion as of April 26, according to data from the central bank on Friday.

The reserves fell by $2.41 billion in the reported week, after falling by a total of $8.2 billion over the previous two weeks.

The Reserve Bank of India (RBI) intervenes in the foreign exchange market to curb excess volatility in the rupee.

India's improving trade deficit, inflows into bonds and reduced pressure on the rupee in the offshore market have reduced the need for the RBI to intervene aggressively in the foreign exchange market, Reuters reported.

Changes in foreign currency assets are caused by the RBI's intervention as well as the appreciation or depreciation of foreign assets held in the reserves.

Foreign exchange reserves also include India's reserve tranche position in the International Monetary Fund.

For the week to which the foreign exchange data pertains, the rupee traded in a range of 83.2525 to 83.4450 against the dollar, and had risen 0.2%.

The currency settled at 83.4225 on Friday and logged a marginal weekly loss.

FOREIGN EXCHANGE RESERVES (in million U.S. dollars)

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April 26 April 19

2024 2024

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Foreign currency assets 559,701 560,860

Gold 55,533 56,808

SDRs 18,048 18,034

Reserve Tranche Position 4,639 4,631

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Total 637,922 640,334

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Source text: (https://www.rbi.org.in/scripts/BS_PressReleaseDisplay.aspx)

(Reporting by Siddhi Nayak; Editing by Sonia Cheema)