MUMBAI: The country’s foreign exchange reserves continued to strengthen for the sixth successive week, adding another $2.951 billion, taking the reserves to a new all-time of $645.583 billion for the week to March 29, the Reserve Bank said on Friday.
The forex kitty had increased by $140 million to $642.631 billion in the previous reporting week. Meanwhile, the monetary policy as well as the forex accretion has had a salutory impact on the rupee, which has been under pressure for some time now, rallying 9 paise to close at 83.30 against the dollar. The rupee had plumbed to historic low of 83.48 on March 22 this year, plunging 35 paise against the American currency. Its earlier lowest closing was of 83.40 on December 13, 2023.
On Friday, the local unit opened at 83.44 against the greenback and had hit an intra-day high of 83.26 and a low of 83.45. In September 2021, the forex kitty had reached an all-time high of $642.453 billion. The reserves got depleted as the central bank began to deploy the forex to defend the rupee after external pressures put the currency in a weak position.
The monetary authority uses the forex reserves to not defend the rupee but to contain volatility. For the reporting week, foreign currency assets, the major component of the reserves, rose $2.354 billion to $570.618 billion.