The Hindu Business Line : Forex reserves down by $1.41 b

Mumbai, July 25 After a marginal rise last week, the country’s foreign currency reserves fell by a huge $1.413 billion to touch $307.107 billion, during the week ended July 18, according to the Reserve Bank of India’s Weekly Statistical Supplement.

In the previous week, forex reserves had increased by $123 million to $308.520 billion.

The fall in reserves is probably because the RBI was selling dollars directly to oil companies, in exchange for oil bonds, said a senior treasury official with a public sector bank. The week under consideration also saw very little FII inflow, which is also reflected in the lower reserves, he said.

Foreign currency assets fell by $1.415 billion to touch $ 297.371 billion. Foreign currency assets expressed in dollar terms include the effect of an appreciation or depreciation of non-US currencies, such as euro, sterling and yen. The week under review saw the euro depreciating from $1.5857 to $1.5838.

According to figures from SEBI, the net FII inflow was just $5.4 million during the week. Gold and SDRs were unchanged at $9.208 billion and $ 11 million respectively.

The country’s position in the IMF increased by $2 million to touch $517 million.

Next week, the rupee is likely to appreciate and the range is likely to be 41.80-42.30, said forex dealers.

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