The Reserve Bank of India (RBI) said on Friday that India’s foreign exchange reserves fell to a one-month low of $593.2 billion in the week ending June 23.
That was a $2.9 billion drop from the prior week. In the week ending June 16, reserves had increased by $2.35 billion.
In order to stop the rupee from moving out of control, the central bank intervenes in the spot and forwards markets.
The impact of other currencies held in the reserves of the RBI on the changes in foreign currency assets, represented in dollar terms, is also taken into account.
India’s Reserve Tranche holdings at the International Monetary Fund are included in the country’s foreign exchange reserves.
In the week ending June 23, the rupee experienced a 0.1% decline and fluctuated between 81.8900 and 82.1675.
It had its best month since January and closed at 82.0375 on Friday.