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

Forex reserves dropped by $1.320 billion to touch $165.138 billion, for the week ended September 8. In the previous week, reserves increased by $1.132 billion to touch $166.458 billion.

Foreign currency assets decreased by $1.317 billion to touch $157.835 billion during the week. The reserve position in the IMF decreased by $3 million to stand at $764 million, according to the RBI's Weekly Statistical Supplement.

Gold reserves and Special Drawing Rights remained unchanged at $6.538 billion and $1 million, respectively.

"There was a revaluation of currencies during the week under consideration," said Mr J. Moses Harding, Executive Vice- President, Head-Wholesale Banking Group, IndusInd Bank. Non-US currencies weakened against the dollar. The euro traded between $1.2812 and $1.2848. "There could also have been a Government related payout impacting the forex reserves," he said.

"FII inflows had also slowed down in the week under consideration," said a dealer at a private bank. There was an FII inflow of around $165 million ($ 316.60 million) into the bourses during the week.

Some dealers are expecting the home currency to trade below 46 levels.

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