FX reserves fall for fourth week, down $50 billion from September peak | Economy & Policy News

India’s foreign exchange reserves fell for ​a fourth consecutive week ​to $734.6 billion, according to a ‌footnote to Reserve Bank of India Governor Sanjay Malhotra’s statement.

The reserves have dropped from their recent peak of $785.71 billion on September 4, a decline of about $50 billion in less than a ‌month.

The drawdown reflects the RBI’s dollar sales in the spot market to smooth the rupee’s decline, alongside sell/buy FX swaps aimed at absorbing surplus liquidity.

Despite ​the central bank’s support, the rupee has continued ‌to weaken, pressured by elevated oil prices, ​rising US ‌Treasury yields and increased foreign equity ‌outflows.

The decline accelerated on Wednesday, with the currency falling ‌nearly 0.5% ​to 96.8450 ​per dollar, within sight of its all-time low of ‌96.96. 

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