By Anjali Sharma
NEW YORK – Reserve Bank of India data released on Saturday showed that after growing geopolitical tensions and FII selling, India’s foreign exchange (forex) reserves dropped $10.746 billion to $690.43 billion for the week ended October 11.
The forex had hit an all-time high of $704.885 billion at the end of September, data stated.
The forex had dropped by $3.709 billion to $701.176 billion.
It said that gold reserves decreased by $98 million to $65.658 billion during the week.
Special Drawing Rights were down by $86 million to $18.339 billion. The country’s reserve position with the International Monetary Fund was down by $20 million to $4.333 billion.
India’s forex reserves are projected to grow, it added.
The strong forex will boost its economic growth trajectory by strengthening its position internationally, drawing in foreign investments, and promoting domestic trade and industry.
According to industry experts, strengthened Forex and a strong monetary policy stance are creating confidence among trade and industry and attracting foreign investments after geopolitical vulnerabilities..
The share of gold in the country’s forex has also surged more than 209 per cent since 2018.
The gold prices continued their strong upward momentum, with a sharp rise of Rs 500 in MCX, taking the price to Rs 77,600, supported by Comex gold surging above $2,710.
In 2024, gold has delivered impressive returns of over 22 per cent, and on a Diwali-to-Diwali basis, returns have reached nearly 30 per cent.
It makes gold one of the standout performers for the year.
The price momentum remains strong, with a potential upside target of Rs 78,500 in the coming sessions, experts stated.
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