Forex reserves fall $1.6 billion as value of gold falls

MUMBAI: The country’s foreign exchange reserves dipped $1.65 billion during the week ended November 1 after seeing strong accretion for four straight weeks.

The dip in reserves during the week is partly due to dip in value of gold in reserves. Also, foreign currency assets with the central bank dipped during the week.

The foreign exchange reserves, including gold and SDR — or the currency with IMF — are at $281.3 billion as on November 1, according to the latest Reserve Bank of India data.

While foreign currency assets dipped $894 million, the value of gold in reserves dipped $538 million. Even as there has been strong inflows on account of RBI offering special concession on swapping FCNR(B) deposit proceeds to banks, currency dealers say there was strong dollar demand from oil marketing companies which could have resulted in some drawdown in reserves.

Following the central bank’s concession on FCNR(B) deposits, the central bank received around $10 billion inflows, adding cushion to the reserves kitty