India's foreign exchange reserves recorded the biggest weekly decline of $17.76 billion in the week ended November 15. This brought the foreign exchange reserves to a four-month low of $657.8 billion. This information was given in the latest data released by the Reserve Bank of India on Friday.

The foreign exchange reserves declined due to the strengthening of the US dollar and the sale of dollars by the Indian central bank. The Reserve Bank of India sold dollars to limit the volatility of the rupee.

Anil Kumar Bhansali, Treasury Head, Finrex Treasury Advisors, said, "The Indian Reserve has been selling dollars for the last three months to save the rupee. Apart from this, the import figures for August and October show that our imports are also increasing continuously. In such a situation, there is more selling of dollars than buying and exporters are also not able to get their receipts."

Earlier, the biggest weekly decline in foreign exchange reserves was on October 24, 2008, and at that time a decline of $ 15.5 billion was recorded in this week. Foreign exchange reserves have fallen for the seventh consecutive week after touching a record high of $ 705 billion on September 27, 2024.

Gopal Tripathi, President and Head of Treasury and Capital Markets at Jana Small Finance Bank, said, "Due to the strong US dollar, other foreign currencies and gold declined and we keep foreign exchange reserves in it. This led to a decline in our foreign exchange reserves. The dollar index was earlier around 103-104 and it climbed to 107.5. This further worsened the situation of our foreign exchange reserves. Apart from this, the Reserve Bank of India (RBI) is also selling dollars to reduce the fluctuations in the rupee. This further led to a decline in foreign exchange reserves.

The rupee fell 0.04 percent against the dollar in the week ended November 15, 2024, as compared to the previous week. So far this month, the rupee has fallen 0.46 percent against the dollar.

The Indian rupee remained under pressure after the US Federal Reserve began its interest rate cut cycle in September. Apart from these, the rupee came under pressure due to the victory of US President Donald Trump in the US elections, the withdrawal of funds by foreign investors, and increasing pressure on market currencies. During this period, the rupee performed better against the dollar than other Asian currencies.

The dollar has strengthened after the US elections. Apart from this, the euro and the British pound weakened this week. Karur Vysya Bank's treasury head VRC Reddy said, 'Foreign exchange reserves declined sharply during this review period due to three main reasons. These include withdrawal of foreign institutional investors from equity and debt, fall in gold prices (these are dollar-denominated), and weakening of major currencies including the euro and the British pound against the dollar.'

Bank of Baroda Chief Economist Madan Sabnavis said, "Due to excessive volatility, the Reserve Bank of India's efforts to protect the rupee from falling and revaluation led to a sharp decline in foreign exchange reserves. Apart from this, the fall in the price of gold also affected the reserves. The reason for this is that this yellow metal has a substantial proportion in our currency reserves."