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

THE country's foreign exchange reserves have fallen by over $1 billion for the week ended June 3 on account of international currency revaluation and a dip in gold reserves.

Forex reserves fell by $1.168 billion to touch $138.661 billion during the week ended June 3, according to the RBI's Weekly Statistical Supplement. In the previous week, the reserves had risen by a marginal $175 million. However, the reserves had fallen by $2.892 billion for four consecutive weeks until May 20.

During the week under review, foreign currency assets have fallen by $1.218 billion to touch $132.730 billion. Gold reserves fell by $67 million to touch $4,376 million on account of a fall in gold prices. Foreign currency assets expressed in US dollar terms include the effect of appreciation or depreciation of non-US currencies held in reserves. Hence, currency revaluation might have resulted in the fall.

The country's reserve tranche position in the International Monetary Fund, however, rose by $117 million to $1.551 billion. The special drawing rights remain unchanged at $4 million.

A treasury head at a private bank said that the week in question saw a fall of 1.5 per cent in the euro's value against the dollar.

The euro had touched a seven-month low to touch $1.2220 during the week in question. The concern about the European Union's economic and political outlook had caused a drop in the value of the euro against the dollar. The rejection of the EU constitution by France and the Netherlands also dampened sentiment.

Foreign institutional inflows in this week amounted to $255.2 million, according to SEBI's Web site.

Regarding the outlook for the rupee, the treasury head said that the rupee might weaken but not significantly. It may trade in the range of Rs 43.45 and Rs 43.65. The US trade data released on Friday was favourable to the dollar, implying a weak opening for the rupee next week.

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Wealth management by banks poised to grow

Forex reserves dip by over $1 b

IDBI examining options to merge home finance arm with itself

`Take balanced view on FDI in private banks'

Bank of India sees Rs 850-cr net this fiscal

Bank credit rises Rs 6,919 cr

BoI, SIDBI tie up to boost credit to SMEs