Login With Google
Forex Reserves
Why is it in news?
- The country’s foreign exchange reserves touched a life time high of $555.12 billion after it surged by $3.615 billion in the week ended October 16.
Forex Reserves:
- Foreign exchange reserves are reserve assets held by a central bank in foreign currencies, used to back liabilities on their own issued currency as well as to influence monetary policy.
- The forex reserve is also kept as a cushion against any potential balanced of payment related crisis.
- India’s foreign exchange reserves comprises of (i) Foreign currency assets (FCA), (ii) Gold, (iii) Special Drawing Rights (SDRs) and (iv) Reserve tranche position (RTP) in the International Monetary Fund.