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Foreign exchange reserves remain steady

Posted on Feb 27, 06:23PM | IBNS

New Delhi, Feb 27 : The Economic Survey 2012-13 presented by Union Finance Minister P. Chidambaram in the Lok Sabha on Wednesday stated that the Foreign Exchange Reserves in the current fiscal, on month-on-month basis remained in the range of US $ 286.0 billion (at end-May 2012) to US $ 295.6 billion (at end-December 2012).

By end of December 2012, reserves stood at US $ 295.6 billion, indicating a marginal increase of US $ 1.2 billion from US $ 294.4 billion in March, 2012. At this level, reserves provided about seven months of import cover, the Survey observes.

India's foreign exchange reserves comprise foreign currency assets (FCA), gold , special drawing rights (SDRs) and reserve tranche position (RTP) in the International Monetary Fund (IMF).

The level of foreign exchange reserves is largely the outcome of the Reserve Bank of India (RBI) intervention in the foreign exchange market to smoothen exchange rate volatility and valuation changes due to movement of the US dollar against other major currencies of the world.