Foreign exchange reserves recover from seven-week lows

Foreign exchange reserves broke a three-week losing streak to $641.59 billion as of May 3, rebounding from their lowest point in seven weeks, data from the Reserve Bank of India showed.

During the reporting week, reserves surged by $3.7 billion, marking the best gain in almost two months. The positive momentum followed a cumulative decrease of $10.6 billion over the previous three weeks.

The Reserve Bank of India (RBI) actively intervenes in the foreign exchange market to mitigate excessive volatility in the rupee's value.

Fluctuations in foreign currency assets are influenced by the RBI's intervention as well as the appreciation or depreciation of foreign assets held within the reserves. Additionally, foreign exchange reserves comprise its reserve tranche position in the International Monetary Fund.

Throughout the week in focus, the rupee traded within a range of 83.34 to 83.5250 against the dollar, experiencing marginal weekly losses. By the end of the week, the currency settled at 83.50, registering a slight decline of nearly 0.1 per cent week-on-week.

(With Reuters inputs)