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Our Bureau

The RBI had been buying dollars in the market during the week.

Mumbai , March 3

The foreign exchange reserves increased for the fifth consecutive week, according to the Reserve Bank of India's Weekly Statistical Supplement.

For the week ended February 24, the forex reserves increased by $350 million to touch $141.590 billion, up from $141.240 billion in the previous week. The reserves had gained by $811 million for the week ended February 17.

Foreign currency assets increased by $349 million to touch $135.15 billion in the week concerned. Foreign currency assets expressed in dollar terms include the effect of appreciation or depreciation of non-US currencies such as euro, sterling and yen.

According to the senior official at a private bank, the RBI had been buying dollars in the market during the week under question.

"The strong foreign institutional investor dollar inflows in the forex market were being mopped up by PSU banks on behalf of the RBI. The central bank could have replenished its reserves post the redemption of IMD that had depleted the forex kitty," said the official.

The FII inflows during the week were $651.3 million.

Dealers also said that yen and the euro had gained by more than 100 basis points during the week under consideration. The revaluation effect could therefore also contributed to the rise in reserves.Gold and SDRs were unchanged at $5.680 billion and $3 million, respectively.

India's reserve position in the IMF gained by $1 million to touch $752 million. Dealers said the next week could see the rupee moving in the range of 44.25-44.40.

"The rupee might stay firm as long as there are FII inflows. Once the inflows ebb, the rupee could depreciate to 44.50," said a dealer.

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Forex reserves rise for fifth straight week

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