The value of gold reserves held by the Reserve Bank of India (RBI) rose by $1.98 billion on a weekly basis to $114.58 billion as on June 5, official data showed. Overall forex reserves, however, fell by $711 million to $681.61 billion, largely as value of foreign currency asset (FCA) reduced.
Overall FCA, the largest part of forex reserve, fell $2.70 billion on week to $543.44 billion. FCAs are expressed in US dollar terms and include the effect of change in non-US currencies such as the euro, pound sterling and yen held in the foreign exchange reserves.
India's forex reserves rose by around $938 million in the previous week. India's central bank intervenes in the forex market with it's reserves of there is heightened volatility or sharp short positioning against the Indian rupee. The RBI recently also said it will bear the hedging cost of FCNR-B deposit, to shore up US dollar reserves and aid Indian rupee's recovery.
Indian rupee was trading at around 95 level versus the US dollar, sharply lower than 97 level earlier this year, aided by the RBI's measures. The Indian rupee is expected to trade in the range of 94.70-95.60 level going ahead, traders say.
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