Wow Moment...India’s Forex Reserves rose to USD 513.25B for the first time

Forex reserves rise to record $476.092 billion - The Hindu ...

As per the data released by Reserve Bank of India on 10th July 2020, India’s Forex Reserves reaches to all time high at USD 513.25B.
International reserves are used to settle balance of payments deficits between countries. International reserves are made up of foreign currency assets, gold, holdings of SDRs (Special Drawing Rights) and reserve position in the IMF (International Monetary Fund).

Usually Forex reserve includes:  1. foreign currencies, 2. other assets denominated in foreign currencies, 3. particular amount of special drawing rights.

A foreign exchange reserve is a useful precaution for countries exposed to financial crisis. It can be used for the purpose of intervening in the exchange market to influence or peg the exchange rate.
A growth in forex reserves is a positive sign for Indian economy. With growing forex reserves we are growing stronger like never before.

Here are the purposes of keeping Foreign Exchange Reserves...
  1. To keep the value of their currencies at a fixed rate
  2. Countries with a floating exchange rate system use forex reserves to keep the value of their currency lower than US Dollar.
  3. To maintain liquidity in case of an economic crisis.
  4. The central bank (RBI) supplies foreign currency to keep markets steady.
  5. To ensure that a country meets its foreign obligations and liabilities.

Forex Traders UAE
Sandesh Nandode - Forex and Crypto Analyst, Mumbai - Dubai
Location: Dubai - United Arab Emirates

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