The Hindu Business Line : Forex reserves rise $3 b

Mumbai, Jan 25 The accretion to the country’s foreign exchange kitty continued, as reserves increased by $3.169 billion to $284.898 billion, for the week ended January 19. The rise is mainly due to the central bank buying dollars in order to keep the rupee from appreciating as well as due to currency revaluation.

The increase is less than the previous week’s rise of $5.47 billion, when the total foreign exchange reserves touched $281.73 billion.

The rupee was range-bound against the dollar and traded around the levels of 39.28/29 and 39.30/31 in the week, as the RBI bought dollars in the spot market. This may have led to the increase in the foreign exchange reserves, said a forex dealer.

According to the RBI data , foreign currency reserves increased by $3.170 billion to touch $276.134 billion. Foreign currency assets, as expressed in dollars include the effect of appreciation or depreciation in non-US currencies (euro, sterling and yen) held in reserves.

Gold and SDRs were unchanged at $8.328 billion and $3 million, respectively. The country’s reserve position in the IMF fell by $1 million to $433 million.

A dealer with a public sector bank said the rupee is likely to be firm next week but will not appreciate beyond 39.30. “The RBI is constantly intervening in the spot market,” he said.