MUMBAI: India’s foreign exchange reserves halted a three-week gaining streak and stood at $667.39 billion as of July 26, coming off record highs, data from the central bank showed on Friday.
The reserves fell by $3.5 billion in that week, the most in over three months. They had risen by a total of $18.9 billion in the previous three weeks and hit a record high of $670.86 billion in the week ended July 19.
The Reserve Bank of India (RBI) intervenes in the foreign exchange market to curb excess volatility in the rupee.
Changes in foreign currency assets are caused by the RBI’s intervention as well as the appreciation or depreciation of foreign assets held in the reserves.
In the week to which the foreign exchange data pertains, the rupee had declined to all-time lows, pressured by outflows from local equities.
[India’s foreign exchange reserves rise for third week, hit record high][1]
That may have led the RBI to sell dollars in the spot and non-deliverable forwards market to support the local currency, Reuters reported.
Foreign exchange reserves also include India’s reserve tranche position in the International Monetary Fund.
The currency settled at 83.75 on Friday, its weakest closing level, after hitting an all-time low of 83.7525 earlier in the session. The currency was nearly flat week-on-week.
American Dollar Exchange Rate