Forex reserves rise $684 million

Written by fe Bureaus | Mumbai | Updated: Oct 31 2009, 07:13am hrs
The countrys foreign exchange reserves rose by $684 million to $285.5 billion in the week ended Oct 23, the Reserve Bank of India (RBI) said in its weekly statistical supplement released on Friday. While foreign currency assets climbed $450 million to $268.3 billion, gold reserves were unchanged at $10.3 billion, RBI said. Special drawing rights with the International Monetary Fund increased by $17 million to $5.26 billion, while reserves with the IMF rose by $217 million to $1.58 billion.

The rupee saw heavy strengthening against the dollar, with booming company earnings and flourishing stock markets. Another reason for the rupees rise was the strong expansion in the US economy that improved prospects of a global recovery from the economic crisis. On Friday, the rupee climbed 0.5% to 46.97 against the dollar, compared to 47.21 on Thursday. We continue to stay with medium-term range of 46-47.50, with overshoot either way not to sustain, noted J Moses Harding, head of global markets group with Indusind Bank.

According to data released by Sebi, foreign investors raised total holdings of Indian shares to a record $69.6 billion on Oct 28. Bonds also witnessed a fall on speculation that the central bank will raise interest rates to temper inflation. The yield on the 10-year benchmark paper, 6.90% bond maturing 2019 rose by 3 bps, to 7.30%.