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India's foreign exchange (forex) reserves dropped by $28.05 billion in the second half of FY22. RBI's latest data shows that the country's reserves stood at $607.31 billion from October 2021 to March 2022.
In the first half of FY22 ending September 2021, the reserves stood at $635.36 billion.
As of March 31, 2022, foreign exchange assets stood at $540.72 billion, while gold reserves are at $42.55 billion and SDRs at $18.89 billion while RTP came in at $5.14 billion.
Under foreign currency assets, reserves in securities declined to $363.03 billion in H2FY22 compared to $383.74 billion in H1FY22, while reserves in deposits with other central banks & BIS - dropped to $140.54 billion in H2 compared to $147.86 billion in H1. Reserves in deposits with commercial banks overseas plunged to $37.16 billion in H2 against $42 billion in H1.
Notably, although both the US dollar and Euro are intervention currencies and the Foreign Currency Assets (FCA) are maintained in major currencies, the foreign exchange reserves are denominated and expressed in US dollar terms.
Furthermore, movements in the FCA occur mainly on account of the purchase and sale of foreign exchange by the RBI, income arising out of the deployment of the foreign exchange reserves, external aid receipts of the Central Government, and changes on account of revaluation of the assets.
Meanwhile, the net forward asset (receivable) of RBI in the domestic foreign exchange market stood at $65.79 billion as of the end of March 2022.
