The Wire Staff 
New Delhi: The value of India’s foreign exchange (forex) reserves dropped by $6 billion in the week ended May 19. The dip comes a week after its value soared to a near-one-year high of $599.93 billion.
Reserve Bank of India (RBI) data shows that the forex is currently valued at $593.5 billion.
A report by Deccan Herald states that the reasons behind the dip are a “sharp drop in the value of gold reserves and foreign currency assets” and RBI intervention to maintain stability in the Indian rupee’s value.
“We had to intervene in the market because our primary focus is to maintain the stability of the Indian rupee, the stability of the exchange rate,” RBI governor Shaktikanta Das told the newspaper.
Gold reserves declined by $1.22 billion to $45.12 billion during the week ended May 19.
While the reserves had increased in the couple weeks before last, they have been generally declining since reaching a record high of $645 billion in October 2021 due to efforts by the RBI to defend the rupee from global pressures, Business Standard reported.
Foreign exchange reserves are like piggy banks of foreign currency that countries store to keep their economies stable. They use these reserves to pay for goods from other countries and buy back their own currencies in order to stabilise their value.