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Sunday, Feb 27, 2005

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Forex reserves spurt $2.97 b

Our Bureau

Mumbai , Feb. 26

PROPELLED by a steady spate of dollar inflows, coupled with a revaluation in the central banks basket of currencies, the country's forex kitty surged by $2.97 billion in a single week, as per the latest RBI statistics.

Total reserves shot up to $132.959 billion during the week ended February 18, as against $129.980 billion in the previous week, according to RBI's weekly statistical supplement.

Analysts ascribe the rise in reserves to the flood of external investments in Indian equities and a strengthening trend in global currencies such as the euro and yen against the greenback. For the week ending February 18, FII inflows stood at $666 million.

Another significant factor contributing to the rise in reserves, is the aggressive bout of dollar buying that state run banks have been engaging in over the past few weeks, perhaps at the behest of RBI, said Mr U. Venkatraman, Head-Forex and Money Market, IDBI Bank.

During the week under review, foreign currency assets moved up by $2.97 billion to $127.152 billion.

Aided by the strong dollar inflows, the rupee closed stronger on at Rs 43.71/73 per dollar on Friday, Feb 25, as against its levels on Monday, Feb 21, 43.81/82.

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