Snapping four consecutive weeks’ rising streak, the country's foreign exchange reserves dipped $1.65 billion to $281.29 billion in the week to November 1 on account of a sharp drop in a key component, foreign currency assets, as per Reserve Bank of India (RBI) data. Though, the reserves increased by $1.828 billion to $282.95 billion.
Foreign currency assets (FCAs), which form the largest chunk of the reserves, dropped by $894.2 million to $253.61 billion in the week under review. Further, the dip in reserves during the week was also partly due to dip in value of gold in reserves, which dropped by $538 million to $21.23 billion. Additionally, the Special Drawing Rights (SDRs) fell by $46.9 million to $4.42 billion, while India's reserve position with the International Monetary Fund was down by $177.9 million to $2.03 billion.
Despite the strong inflows on account of RBI’s offering special concession on swapping FCNR (B) deposit proceeds to banks, strong dollar demand from oil marketing companies probably resulted in some drawdown in reserves.
