India’s forex reserves increase by $11.9 billion to hit $534.5 billion

[Chhatrapati]

increase Forex reserves but this model failed in egypt .

Indian foreign loans always lead Indian foreign reserves.

Some fantasy to think India takes loans to improve Forex. Loans taken are not parked unless we take loans at a negative interest rate.

I get the impression that this increase is more due to loan in USD.

The spike in Forex is not due to an increase in the loan, but an increase in FPI, FII and increase in value of FCA. Of the Forex, around $40 billion is in gold reserves, $4 Billion in IMF reserve position, $1.4 billion as SDR, the rest around $390 billion in Foreign Currency Asset. FCA is mostly in T-bills, and bonds.

 

[Prince Kassad]

lol, this is another confusing thing I dont understand, why don't countries use their reserves to pay off debt?

because its corporate debt

 

[macnurv]

How do foreign reserves increase?

PM relive Fund

 

[Prince Kassad]

Indian Farmers are over the Moon ....oh wait....they are looking towards the Moon.

we could loan you some cash to clean Karachi up if army isn't doing the best they can

https://tribune.com.pk/story/225781...f-cleaning-operation-in-karachis-storm-drains

 

[CrazyZ]

India had currency swap arrangements with Japan and USA. India's forex dropped big time before USA fed reserve gave them a swap facility (the ability to change INR to USD on easy terms). Indian forex has been increasing since then. Also most of India's Forex is held in foreign securities, mostly USA treasuries. As USA securities increase in value due federal reserve actions, so do India's forex valuations.

 

[Indos]

Some fantasy to think India takes loans to improve Forex. Loans taken are not parked unless we take loans at a negative interest rate.


The spike in Forex is not due to an increase in the loan, but an increase in FPI, FII and increase in value of FCA. Of the Forex, around $40 billion is in gold reserves, $4 Billion in IMF reserve position, $1.4 billion as SDR, the rest around $390 billion in Foreign Currency Asset. FCA is mostly in T-bills, and bonds.

T-bills and Bonds are another name of loan dude and you need to pay for interest as well for this financial product

 

[Chhatrapati]

T-bills and Bonds are another name of loan dude and you need to pay for interest as well for this financial product

T-bills are US treasury bonds.

 

[CrazyZ]

lol, this is another confusing thing I dont understand, why don't countries use their reserves to pay off debt?

No country will ever pay off its debts. All national debt cycles end in currency debasement, default or restructuring. This has been the history for hundreds of years. This current crisis will end mass currency debasement in many nations.

 

[Dark1]

It'll be an interesting take when our forex passes $563.9 billion.

I bought a 60 lakh house with a loan when my annual income was 20 lakhs and my savings were also around the same.
Means i am bankrupt.....

 

[Dark1]

Can you post us a link of Indian trade surplus during first semester of 2020 and July ???

I get the impression that this increase is more due to loan in USD. Not really surprising since India need to borrow money to fund its huge Covid 19 stimulus.

Google is your friend.
Hint - corporate taxes

 

[Osiris]

ohh common you have never read my pre-2010 posts dear

Ohh..but i have .

 

[Indos]

No secret that all Government issue bonds to support their Covid 19 measures, including Indonesian government. Most of Indonesian Covid 19 stimulus is fund by bonds. International buyer absorb most of our bonds so our forex reserve will increase because of that.

 

[Chhatrapati]

No secret that all Government issue bonds to support their Covid 19 measures, including Indonesian government. Most of Indonesian Covid 19 stimulus is fund by bonds. International buyer absorb most of our bonds so our forex reserve will increase because of that.

The bonds issued by you becomes the FCA of the country that buys your bond. It is pointless to park loans in reserves because reserves do not give any interest what it does is increase or decrease with changes in the value of the said currency.

 

[Dark1]

The bonds issued by you becomes the FCA of the country that buys your bond. It is pointless to park loans in reserves because reserves do not give any interest what it does is increase or decrease with changes in the value of the said currency.

2 reasons for increase-
India reduced its corporate taxes and this attracted a lots of funds from tax havens
Corona led to a decrease in imports, increasing our foreign exchange

Foreign exchange doesn't physically stay in Indian banks normally.
Its parked in US bonds and other safe bonds. Like we park our funds in FDs.

 

[Indos]

The bonds issued by you becomes the FCA of the country that buys your bond. It is pointless to park loans in reserves because reserves do not give any interest what it does is increase or decrease with changes in the value of the said currency.

We get USD after international buyer buy our bond then the USD that we collect turn into our currency, Rupiah, to provide financial help for the poor. Where do we put the USD ?? Will it be just gone ?