The Hindu Business Line : Forex reserves surge by over $1 b

Analysts ascribed the rise in reserves primarily to a revaluation of foreign currencies with the central bank, in addition to foreign investment inflows coming into Indian markets.

Although the forex reserves surged in dollar terms, the rise in rupee terms was less than proportionate.

In rupee terms, the reserves went up by a mere Rs 336 crore during the week ended November 5. This discrepancy is due to the US dollar weakening against the rupee and international currency majors, said an RBI spokesperson.

The rupee had reached a five-month high of 45.20/21 per dollar during that week.

As on the week ended November 5, forex reserves surged by $1.046 billion to touch $122.224 billion against total reserves of $121.178 billion in the previous week.

While foreign currency assets with the Reserve Bank of India rose in dollar terms by $882 million, in rupee terms, there was a dip of Rs 69 crore, as per RBI statistics.

"A similar phenomenon can be observed in the reserves position for the week ended October 29.

"During that week, reserves had risen by $562 million to $121.178 billion, but had recorded a decline in rupee terms by Rs 1,177 crore.

Even during this period, the rupee had staged a significant appreciation against the greenback, touching a four-month high of 45.37/38 per dollar," said an analyst.

According to RBI's Weekly Statistical Supplement, gold reserves increased by $159 million to $4.351 billion.

The reserve tranche position in the International Monetary Fund went up by $5 million to $1.335 billion.

Outstanding amounts under the repos and reverse repo auctions under the liquidity adjustment facility of RBI ranged from Rs 275 crore to Rs 3,835 crore during the week.

According to SEBI's data, during the week, foreign investments in the country were to the tune of $408 million.

During the past week, the domestic currency had appreciated to a high of 44.87 per dollar on the back of strong dollar inflows.

However, for most of the week, the rupee remained in a tight band of 45.15 to 45.1850 per dollar.

On Thursday, the domestic currency strengthened to close at a five-month high of 45.15/16 against the dollar.

Financial markets remained closed on Friday on account of Diwali.