| Date: |
21-02-2015 |
| Subject: |
India's forex reserves scales new heights with global investors pouring dollars |
|
KOLKATA: India's foreign exchange reserves rose for the third consecutive week as foreign investors continued to pour in billions in the local markets after the US Federal Reserve and the European Central Bank softened their monetary policy stance improving the availability of global liquidity.
The reserves swelled by 42.956 billion in the week to February 13, taking it to a new high of $333.170 billion. Total accumulation in the last three weeks was $11.132 billion.
Although the reserves is now adequate to finance 10 months' imports, it is yet to cover India's external debt of $450 billion.
RBI is expected to pile in more reserves in the months to come as global investors raised their funding in Indian stocks and amid improved local business sentiment. Managing the rise in inflows could be a challenge for the central bank, experts say, as RBI would need to protect market stability and prevent the rupee from gaining sharply.
The rupee has been hovering around 62 to the dollar and has gained almost 2% against the greenback since January. The Indian currency has been the best performing major currency this year, even better than Chinese Yuan.
Foreign currency assets, the major contributor to reserves, rose $2.299 billion in the week to February 13 to $307.258 billion. Gold reserves in dollars remained unchanged at $20.183 billion. India's reserves position with International Monetary Fund improved by $662 million to $1.640 billion.
Source : economictimes.indiatimes.com
|