Mumbai: India's overall foreign exchange reserves declined $6.05 billion to $593.477 billion in the week that ended on May 19, 2023, data released by Reserve Bank of India on Friday showed.
Last week, it was near USD 600 billion and had hit a one-year high. India's foreign currency assets, the biggest component of the forex reserves, declined by USD 4.65 billion to USD 524.945 billion.
Gold reserves during the latest week declined by USD 1.22 billion to USD 45.127 billion.
In October 2021, the country's foreign exchange reserves touched an all-time high of about USD 645 billion.
Much of the decline since then can be attributed to a rise in the cost of imported goods in 2022.
Also, the forex reserves had fallen largely because of the RBI's intervention in the market to defend the depreciating rupee against a surging US dollar.
Typically, the RBI, from time to time, intervenes in the market through liquidity management, including through the selling of dollars, with a view to preventing a steep depreciation in the rupee.
The RBI closely monitors the foreign exchange markets and intervenes only to maintain orderly market conditions by containing excessive volatility in the exchange rate, without reference to any pre-determined target level or band.