India’s foreign exchange capital dropped for the third straight week to smash an eleven-week low of $561.27 billion for the week ended February 17, the Reserve Bank of India’s (RBI) numerical complement showed.

The reserve decay was principally due to foreign currency assets, which dropped $4.5 billion to $496 billion. The RBI grasps major currencies, counting the pound-sterling, yen, and euro in its assets, which are conveyed in dollar terms.

The RBI data showed that SDRs fell by $87 million to $18 billion. The price of gold reserves in US dollar footing also fell $1 billion to $42 billion. On a year-on-year (YoY) basis, reserves were low by $72 billion and $46 billion related to March 31, 2022.

The variation in forex reserves is triggered due to RBI intervention in the currency market to avert the instability in the exchange rate or dollar movement in contradiction of other currencies held as reserves.

In the preceding week, the rupee fell 0.4% alongside the greenback, its fourth weekly consecutive decline. Economists have held that the probability of sharp gratitude in the dollar remains low.

The US Federal Reserve unconfined the FOMC meeting minutes earlier this week. The minutes specified that some members desired to hike rates by 50 basis points (bps). The FOMC had elevated its benchmark interest rate by 25 bps to a 4.50-4.75% mark range.