The Hindu Business Line : Forex reserves rise by $297 m

INDIA'S forex kitty saw a modest accretion of $297 million for the week ended April 1, taking the total reserves to $141.204 billion, as per the latest RBI statistics.

In the previous week, reserves had declined by $1.223 billion to touch $140.907 billion. According to a dealer from a private bank, the euro weakened against the US dollar. "The euro reached levels between $1.29 and $1.30 against the dollar," he said. FII inflows for the same period have been negative. According to figures from SEBI's Web site, FII inflows saw a fall of $181.5 million.

Foreign currency assets rose by $173 million to touch a total of $135.262 billion for the same period. Gold reserves increased by $124 million, totalling $4.50 billion. Special drawing rights and the country's reserve tranche position in the International Monetary Fund remained unchanged at $5 million and $1.437 billion, respectively.

The rupee ended at Rs 43.75/76 against the dollar on Friday, marginally higher than Monday's close of Rs 43.78/79. Dealers said that the domestic currency is tracking the euro and the pound sterling. "The rupee levels will be based on FII inflows because lately, there has not been much action from corporates. Also, the Union Commerce and Industry Minister, Mr Kamal Nath, has issued a statement that the rupee should be allowed to take its own course," the dealer said.

Oil prices have eased and the US Federal Reserve Chairman, Mr Alan Greenspan, has said that inventories will be good, and this will buoy the rupee. If oil remains below $55 per barrel, it will be a positive for the rupee, the dealer added.

Bond yields saw some hardening on concerns of a possible hike in oil prices. Panic sell-offs by traders led the 10-year benchmark yield to breach 7 per cent levels on Friday.

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