The Hindu Business Line : Forex reserves fall by $1.05 b

THE country's forex reserves declined for the second week in a row. Currency revaluation resulted in a decline in forex reserves by $1.055 billion to touch $144.22 billion for the week ended September 16, according to the Reserve Bank of India's Weekly Statistical Supplement. The forex reserves were $145.277 billion last week.

Foreign currency assets for the week under review fell by $1.047 billion to touch $138.24 billion. Foreign currency assets expressed in US dollar terms include the effect of appreciation or depreciation of non-US currencies (such as euro, sterling, yen) held in reserves. Gold and Special Drawing Rights were unchanged at $4.535 billion and $4 million, respectively.

The country's reserve position in the IMF fell by $8 million to touch $1.440 billion.

According to figures from SEBI, the foreign institutional inflow into the equity market for the week under review was at $365.7 million. The huge fall in the reserves could be due to currency revaluation as the euro has come off the highs by 300 points. The other factor could be the payment of interest on sovereign debt, said the chief of treasury at a private bank.

In the coming week, rupee is likely to remain in the 43.85 to 44-range, due to uncertainties in the US and fear of higher oil prices.

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