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India's forex reserves rose by $1 billion to $687.3 billion in the week ending Dec 5
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Foreign currency assets decreased by $151 million to $557 billion during the same week
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Gold reserves increased by $1.2 billion to $107 billion, boosting overall reserves
India's foreign exchange reserves marginally rose in the first week on December, due to elevated gold prices.
The forex kitty rose $1 billion to $687.3 billion in the week ending Dec. 5, according to the Reserve Bank of India data released on Friday. In the previous reporting week, reserves depleted by $1.9 billion to $686.2 billion.
For the week ended Dec. 5, foreign currency assets, a major component of the reserves, decreased by $151 million to $557 billion, the data showed.
Expressed in dollar terms, the foreign currency assets include the effects of appreciation or depreciation of non-US units, such as the euro, pound, and yen, held in the foreign exchange reserves.
India's forex reserves, one of the largest in the world, can cover imports of over 11 months.
The value of the gold reserves rose by $1.2 billion to $107 billion during the week. The Special Drawing Rights (SDRs) also increased by $93 million to $18.7 billion. India's reserve position with the IMF was steady at $4.7 billion.
The RBI last week announced that it will buy government securities of Rs 1 lakh crore through open market operation during the month. The central bank will also conduct a currency swap worth $5 billion on Dec. 16, wherein it will buy dollars and sell them back three years later, Governor Sanjay Malhotra said.
RBI's purchases of government securities are likely to offset the cash outgo which emerged out of its dollar sales in the currency market recently. The currency market sales were done in a bid to support a weakening rupee, which fell past the psychologically significant barrier of 90 per dollar for the first time last week.
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