{"id":197184,"date":"2022-07-25T18:09:22","date_gmt":"2022-07-25T12:39:22","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=197184"},"modified":"2022-07-25T18:09:22","modified_gmt":"2022-07-25T12:39:22","slug":"explained-making-use-of-forex-reserves","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/explained-making-use-of-forex-reserves\/","title":{"rendered":"Explained: Making use of forex reserves"},"content":{"rendered":"\n<p><b>Source: <\/b><span style=\"font-weight: 400;\">The post is based on the article<\/span><b> \u201cExplained: Making use of forex reserves<\/b><b>\u201d <\/b><span style=\"font-weight: 400;\">published in <\/span><b>Indian Express <\/b>on<b> 25th July 2022.<\/b><\/p>\n<h5><b>What is the News?<\/b><\/h5>\n<p><span style=\"font-weight: 400;\">From a peak of $642.45 billion in 2021, India\u2019s foreign exchange reserves have dipped to $572.71 billion as of July 2022. That\u2019s a fall of almost $70 billion in just over 10 months.<\/span><\/p>\n<h5><b>What are Forex Reserves?<\/b><\/h5>\n<p><a href=\"https:\/\/forumias.com\/blog\/explained-forex-reserves-at-all-time-high-why-did-this-happen-and-what-does-it-mean-for-indias-economy\/\"><b>Click Here to read it\u00a0<\/b><\/a><\/p>\n<h5><b>Why have India\u2019s forex reserves fallen? <\/b><\/h5>\n<p><span style=\"font-weight: 400;\">The major reasons that led to the massive fall in the forex reserves are:\u00a0<\/span><\/p>\n<p><b>FPI outflows: <\/b><span style=\"font-weight: 400;\">There has been a significant outflow of funds from the domestic market by Foreign Portfolio Investors(FPIs).To date in 2022, FPIs have withdrawn $30.3 billion from the Indian financial market.<\/span><\/p>\n<p><b>Rising oil prices:<\/b><span style=\"font-weight: 400;\"> Due to rising oil prices, the import bill goes higher, and India needs to pay more money if the price of oil is rising, which means more outflow of dollars leading to a higher trade deficit.<\/span><\/p>\n<p><b>FCA accounts suffer due to growing dollar strength<\/b><span style=\"font-weight: 400;\">: A large part of forex reserves is by way of foreign currency assets(FCA) accounts. In FCA, the dollar, euro and pound constitute a significant part. But with the outbreak of hostilities in Eastern Europe, both the pound and euro have been sliding, which had an effect on India\u2019s forex reserves.<\/span><\/p>\n<p><b>Safeguarding rupee in focus:<\/b><span style=\"font-weight: 400;\"> According to analysts, the major focus of the RBI has been to prop up the rupee and in doing so it ended up depleting the forex reserves to some extent.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Source: The post is based on the article \u201cExplained: Making use of forex reserves\u201d published in Indian Express on 25th July 2022. What is the News? From a peak of $642.45 billion in 2021, India\u2019s foreign exchange reserves have dipped to $572.71 billion as of July 2022. That\u2019s a fall of almost $70 billion in&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/explained-making-use-of-forex-reserves\/\">Continue reading <span class=\"screen-reader-text\">Explained: Making use of forex reserves<\/span><\/a><\/p>\n","protected":false},"author":10317,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1566,3127,9],"tags":[10500],"class_list":["post-197184","post","type-post","status-publish","format-standard","hentry","category-daily-factly-articles","category-economy","category-public","tag-indian-express","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":1700808885,"cached_date":1701855577},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/197184","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10317"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=197184"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/197184\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=197184"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=197184"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=197184"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}