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Foreign Exchange Reserves Slide $3 Billion Amid Brexit Turmoil

The country's foreign exchange reserves declined by $3.03 billion to $360.79 billion for the week ended June 24 amid volatility in the currency market after Brexit referendum in the UK

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The country's foreign exchange reserves declined by $3.03 billion to $360.79 billion for the week ended June 24 amid volatility in the currency market after Brexit referendum in the UK.

The forex kitty, used to fight volatility in the currency market, had touched a life-time high of  $363.826 billion at the end of the previous reporting week.

The $3.03 billion dip was due to a $2.99 billion decline in the core foreign currency assets (FCAs), the largest part of the reserve, to $336.58 billion, RBI data released on Friday (01 July) said.

FCAs, expressed in dollar terms, include the effect of appreciation/depreciation of non-US currencies such as the euro, pound and yen held in the reserves.

The Reserve Bank had to intervene by selling dollars in wake of the Brexit result last Friday, which triggered a big episode of volatility in the international markets.

In the intra-day trade on last Friday, the rupee had plunged by as much as 93 paise against the dollar breaching the 68 mark, but managed to recover to close the trade with a loss of 71 paise to 67.96.

The RBI data said gold reserves remained unchanged at $20.33 billion.

The country's special drawing rights with the International Monetary Fund dipped by $13.4 million to $1.489 billion and the reserve position decreased by $21.6 million to $2.398 billion, the central bank said.

(PTI)


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forex Brexit dollar Pound