India's forex reserves slump by $6.68 billion to hit two year low

Mumbai: India's foreign exchange (forex) reserves dipped by $6.687 billion to $564.053 billion for the week ended August 19, the lowest level in more than two years, due to a sharp drop in foreign currency assets as the RBI continues to intervene in the currency markets to defend the rupee.

As per the Reserve Bank of India's weekly statistical supplement, foreign currency assets, which are the biggest component of the forex reserves, fell by $5.779 billion to $501.216 billion during the week ended August 19. This is the third weekly fall in the country's forex reserves. The forex reserves had slumped by $2.238 billion during the week ended August 12.

India's foreign currency assets had declined by $2.652 billion to $506.994 billion during the week ended August 12.

Expressed in US dollar terms, the foreign currency assets include the effect of appreciation or depreciation of non-dollar currencies like Euro, UK's Pound Sterling and Japanese Yen held in the foreign exchange reserves.

For the week ended August 19, all components of the country's forex reserves declined.

The value of gold reserves fell by $704 million to $39.914 billion during the week under review.

The value of India's Special Drawing Rights (SDRs) with the International Monetary Fund declined by $146 million to $17.987 billion during the week under review, the RBI data showed.

India's reserve position in the International Monetary Fund (IMF) declined by $58 million to $4.936 billion during the week ended August 19, as per the RBI Weekly Statistical Supplement.