Forex reserves decline by over $1 bn at $353 bn

Rupee breaches 64 again, falls near 2-month low

Foreign exchange reserves fell $1 billion for the week ending July 17 to $353.33 billion, show data from the Reserve Bank of India (RBI). The reserves are currently at a level last seen in the week ending June 5, at $352.71 billion.

Foreign currency assets, a key component, fell $982.14 million to $328.93 billion. Gold reserves remained unchanged at $19.07 billion.

Special Drawing Rights  fell by $39.6 million to $4.02 billion, while India’s reserve position with the International Monetary Fund stood at $1.30 billion, a fall of $12.8 million.

Rupee at 5-week low
On Friday, the rupee weakened to a near two-month low. It had opened at 63.97 and during intra-day trade, touched a low of 63.88 before closing at 64.04 a dollar. On a weekly basis,  the rupee weakened 0.9 per cent from July 17, the most since the five days ended April 24, to 64.0425 a dollar. The rupee had ended at 64.12 a dollar on May 27.



“Today, there was huge demand for dollars from corporates and oil companies, which led to weakening of the rupee. The Reserve Bank of India had intervened but in a limited way. The rupee is biased towards weakening next week,” said Sandeep Gonsalves, forex consultant and dealer, Mecklai & Mecklai.

Currency dealers believe next week, month-end dollar demand by importers will be more due to which the rupee can  touch around the 64.25-level.