Millennium Post

Forex reserves rose $5.8 bn last week to record $327.9 bn

India's foreign exchange reserves zoomed to new high of $327.88 billion, up by a whopping
$5.845 billion, in the week to January 30 mainly on account of robust FII inflows and lower dollar outgo.

In the week to January 16, the forex kitty had jumped by $2.66 billion to reach $322.135 billion, according to RBI data.

For the first time, the forex kitty had crossed $320 billion mark ($320.79 billion) for the week ended September 2, 2011. After the Narendra Modi government came to power in May 2014, foreign funds pumped dollars into Indian equities on the hopes of big-bang economic reforms. In 2014, FIIs pumped in $16.15 billion into Indian equities, while they have exhausted the cap of $30 billion in government securities. They have parked $32.5 billion in corporate bonds, which is 64 per cent of their cap of $51 billion. "We grow more confident of our call that RBI Governor Raghuram Rajan will continue to buy forex reserves to guard against contagion," Bank of America Merrill Lynch (BofAML) said in a report on Friday.

The RBI Governor in a post-policy meeting with reporters earlier this week had said the country's foreign reserve position has improved substantially.
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