Mumbai, Oct. 18: India’s foreign exchange reserve is on its course to hit a century. It whizzed past the $90 billion-mark for the week ended October 10 with record inflows of over $2 billion.
According to the weekly statistical supplement of the Reserve Bank of India (RBI) released today, the reserves, which is now a record high of $ 90,353 million, has rose by $ 2,615 million. This is being attributed to fresh inflows and depreciation of the dollar against other foreign currencies.
The rise in the country’s foreign exchange reserves to a new high, comes only few days after Moody’s Investors Service, the leading global credit rating agency, announced that it has placed the ratings of India on review for a possible upgrade, acknowledging the country’s burgeoning forex reserves.
Dollar inflows into the country have been strong in recent times, boosted by foreign institutional investors (FIIs) and remittances by non-resident Indians (NRIs). Further, the US greenback has also weakend against other currencies. This has resulted in the rupee rising nearly 6 per cent since the beginning of this calendar year on abundant dollar supplies.
According to figures released by the Securities and Exchange Board of India (Sebi), net investment of FIIs in equities for the month of October, so far, has been $981 million or Rs 4,500 crore.
It is projected that FII inflows into the country would continue to remain strong as corporate houses are expected to announce robust numbers. While the second quarterly results posted so far has been encouraging, analysts point out that if the guidance given by technology companies is any indication, the FII-led rally has still some steam left.
While the rising rupee has been a major concern for the RBI, it has on recent occasions, intervened in the markets to halt its surge.
The country’s foreign currency assets also spurted by $ 2,615 million to $86,430 million in the period under review.
The reserve tranche position with the International Monetary Fund (IMF) saw further addition of $ 6 million. However, gold reserves were static at $ 3,919 million while the special drawing rights (SDRs) remained unchanged at $ 4 million.