Forex kitty up by $10 billion to $667 billion

MUMBAI: The country’s forex reserves, a key monetary defence against external risks, have rallied by a whopping $10 billion to touch an all-time high of $666.85 billion as of the week ending July 12, boosted by the heavy inflow into government debt after its inclusion into a global debt index from late last month.

According to the latest data released Friday by the Reserve Bank, the forex reserves have jumped by a hefty $9.69 billion to touch an all-time high of $666.85 billion for the week to July 12.

However, despite the record rally in the reserves, the rupee has plumbed a new life-time low and it has been shedding this week. After closing a lifetime low of 83.66 Thursday, the unit continued to head south today and lost 03 paise against the greenback to close at 83.69 on Friday.

The continuing fall of the rupee is surprising because normally when forex inflows are higher, the rupee gains unless there is also a simultaneous demand for dollars from the banks/importer which would weaken the local currency. But this week being a mid-month week, there is no reason for a higher dollar demand.