India’s foreign exchange reserves shrink by $28.05 billion in second half of FY22: Rbi report
India’s foreign exchange (forex) reserves fell by $28.05 billion in the second half of FY22. Latest RBI data shows the country’s reserves stood at $607.31 billion from October 2021 to March 2022.
In the first half of FY22 ending September 2021, reserves stood at $635.36 billion.
As of March 31, 2022, foreign currency holdings stood at $540.72 billion, while gold reserves stood at $42.55 billion and SDRs at $18.89 billion while the RTP reached $5.14 billion.
Under foreign currency assets, securities reserves decreased to $363.03 billion in H2FY22 from $383.74 billion in H1FY22, while reserves in deposits with other central banks and BIS – fell to 140 $.54 billion in H2 versus $147.86 billion in H1. Reserves in deposits with overseas commercial banks plunged to $37.16 billion in H2 from $42 billion in H1.
In particular, although the US dollar and the euro are intervention currencies and the foreign currency assets (FCA) are maintained in the main currencies, the foreign exchange reserves are denominated and expressed in US dollars.
In addition, FCA movements mainly occur due to the purchase and sale of foreign exchange by the RBI, income arising from the deployment of foreign exchange reserves, external aid receipts from the central government and variations due to revaluation of assets.
Meanwhile, RBI’s net forward (receivable) assets in the domestic foreign exchange market stood at $65.79 billion at the end of March 2022.