Banks had raised about $34 billion through the FCNR (B) from deposits from NRIs in September 2013.
India's current account deficit is expected to deteriorate in the current fiscal on account of costlier imports and tepid merchandise exports, according to the Finance Ministry's monthly economic review. The review released on Thursday by the ministry also said that global headwinds would continue to pose a downside risk to growth as crude oil and edibles, which have driven inflation in India, remain major imported components in the consumption basket. For the present, it said, "their global prices have softened, as fears of recession have dampened prices somewhat. This would weaken inflationary pressures in India and rein in inflation."
Gold reserves increased $1.54 billion to $32.68 billion in the reporting week.
Gold reserve also declined by $340 million to $30.55 billion.
Nepal's decision to ban the import of non-essential items amid depleting forex reserves may hit Indian exports. The country's central bank - Nepal Rastra Bank - last week instructed commercial banks not to open letters of credit (LCs) for importing non-essential items. This is to prevent further decline of the country's foreign exchange reserves. However, it has not issued any formal communication yet.
India's exports in April jumped nearly three-fold to USD 30.63 billion from USD 10.36 billion in the same month last year, according to government data released on Friday.
Reserves had touched an all-time high of $355.46 billion in the week to June 19.
India's foreign exchange reserves shot up to an all-time high of $339.99 billion.
The currency market won't care for our moans, groans, cries and sighs. The rupee will find its own level, explains Tamal Bandyopadhyay.
Foreign exchange reserves jumped $1.17 billion to touch a new record high of $355.46 billion.
The 5-nation BRICS group on signed an agreement to create a $100 billion pool of foreign-exchange reserves to help each other.
Kotak Bank was the top loser in the Sensex pack, falling around 3 per cent, followed by Axis Bank, Sun Pharma, HDFC Bank, Bajaj Finance and Asian Paints. On the other hand, ONGC, PowerGrid and IndusInd Bank were the gainers.
Rating agency Crisil said corporates, especially those in the auto, aviation, consumer durables and oil sectors, will be "severely impacted" by rupee depreciation due to large overseas debt and limited hedging.
Due to tax associations with the fiscal-ending, April is a month of SIP renewal. So, the April numbers will be important and may perhaps, mark a change in retail attitude.
There are some advantages of a falling rupee.
A fall in the rupee could boost exports. But the flip side of the equation is that a weaker rupee could stoke some inflation
While information technology companies will benefit, firms with high foreign borrowings or heavy dependence on imports will be hurt.
Although the current long-term bullish trend is intact, markets are awaiting clarity on the taper and the Assembly election results.
