India?s foreign exchange reserves dropped in the fifth consecutive week to $285.857 billion as of June 1 from $288.259 billion in the previous week, the central bank said in its weekly statistical supplement on Friday. This is a weekly drop of sharp $ 2401 million compared to the drop of $1741 million in the previous week.
According to the data, the foreign exchange reserves is on a losing streak in the month of May with an average drop of around $1500 million every week.
The main reasons of decline are the revaluation effect. ?Movements in the foreign currency assets (FCA) occur mainly on account of purchases and sales of foreign exchange by the RBI in the foreign exchange market in India, income arising out of the deployment of the foreign exchange reserves, external aid receipts of the central government and the effects of revaluation of the assets??. said the central bank.
