Question : India’s foreign exchange reserves have recently crossed a milestone mark .What is that milestone figure ?
(a) 501.70 billion dollars
(b) 100 billion dollars
(c) 1000 billion dollars
(d) None of the above
Answer : (a)
Related facts
- India’s foreign exchange reserves rose to 501.70 billion dollars for the week ended 5th of June, helped by a whopping rise in foreign currency assets.
Components of the foreign currency assets
- Foreign currency assets, a major part of the overall reserves, rose by 8.42 billion dollars to 463.63 billion dollars.
- In the previous week, the reserves had advanced by 3.44 billion dollars to end at 493.48 billion dollars.
- Total value of the gold reserves, however, continued to decline.
Gold reserves declined by 329 million dollars to end at 32.352 billion dollars. - India’s special drawing rights with the International Monetary Fund went up by 10 million dollars to 1.44 billion dollars, while the country’s reserve position also rose by 120 million dollars to 4.28 billion dollars.
Impact to the economy
- Foreign exchange identifies the process of converting domestic currency into international banknotes at particular exchange rates.
- These transactions present distinct ramifications for the global economy.
- Foreign exchange rates affect international trade, capital flows and political sentiment.
By : Pankaj Pandey