Skip to main content

FX reserves remain more than adequate

The drop in FX reserves to the lowest level in almost two years has raised concerns in some quarters that the RBI’s policy of FX intervention to slow the depreciation of the rupee is not sustainable. We think this is overblown. After all, over the past several years but in particular since the start of the pandemic, the RBI has built itself a buffer of reserves significantly larger that most measures of adequacy suggests it needs.

Become a member to read more

This is premium content that requires an active Capital Economics subscription to view.

Already a member?

You may already have access to this premium content as part of a paid subscription.

Sign in to read the content in full or get details of how you can access it

Register for free

Sign up for a free account to gain:

  • Unlock additional content
  • Register for Capital Economics events
  • Receive email updates and economist-curated newsletters
  • Request a free trial of our services


Get access