Forex reserves zoom by $10.417 billion to $572 billion
- India’s forex reserves zoomed by $10.417 billion to $572 billion, making it one of the biggest weekly jumps in recent times.
Recent trends in FOREX Reserves
- In the previous reporting week, the overall reserves had dropped by $1.268 billion to $561.583 billion.
- In October 2021, the country’s forex reached an all-time high of $645 billion.
- The reserves have been declining as the central bank deploys the kitty to defend the rupee amid pressures caused majorly by global developments.
- In October 2022, the reserves had swelled by $14.721 billion during a week.
What is Foreign Exchange (Forex) Reserve?
- Foreign exchange reserves are important assets held by the central bank in foreign currencies as reserves.
- They are commonly used to support the exchange rate and set monetary policy.
- In India’s case, foreign reserves include Gold, Dollars, and the IMF’s quota for Special Drawing Rights.
- Most of the reserves are usually held in US dollars, given the currency’s importance in the international financial and trading system.
- Some central banks keep reserves in Euros, British pounds, Japanese yen, or Chinese yuan, in addition to their US dollar reserves.
PRelims Take AWay
- SDR
- IMF
- Foreign Reserves