The Hindu Business Line : Foreign exchange reserves up $287 m

THE country's forex kitty was enhanced by $287 million to touch an all-time high of $117.879 billion for the week ended April 23, against total reserves of $117.592 billion in the previous week, as per the latest RBI statistics.

The rise in reserves was mainly owing to a $291-million rise in the country's foreign currency assets, which touched $112.394 billion as on April 23.

Foreign currency assets expressed in dollar terms include the effect of appreciation and depreciation of non-US currencies such as euro, sterling and yen, according to the Weekly Statistical Supplement of RBI. The increase in foreign currency assets, however, was offset by a dip in RBI's reserves position with the International Monetary Fund. The Reserve Tranche Position (RTP) dipped by $4 million to $1.285 billion.

"RTP which was shown as a memo item from May 23, 2003 to March 26, 2004, has been included in the reserves from the week ended April 2, 2004, in keeping with the international best practice", according to the W.S.S.

Currency experts have been talking of a cash-dollar shortage in the domestic forex markets for a while now. Market participants who have been jittery on a number of factors ranging from exit polls, to apprehensions of a possible hike in the US fed rate, leading to a slowdown of FII investments into the country in the near future, have been running to cover their short positions and then unwind their longs based on the slightest triggers.

Amid all the uncertainties, the domestic currency plummeted to 44.53 in its value to the dollar, with an outlook of stabilising at around 44.75 levels. The usual month-end scramble for the greenbacks by corporates and banks first drove the rupee down by 25 paise to 44.40/42 per dollar on Thursday, with the domestic currency slipping by another 11 paise to close weaker at 44.53 on Friday.

Meanwhile, as per the W.S.S., gold reserves were at $4,198 million while special drawing rights were at $2 million.