RBI switches more funds into foreign bonds
17 Jul 2009
The Reserve Bank of India has increased the amount of foreign exchange reserves invested in foreign bonds and sharply cut deposits held with foreign banks, it said in its half-yearly report on its reserves.
As its reserves fell to $241 billion at end March 2009 from $277 billion in September 2008, RBI increased its holdings of foreign bonds by $23 billion to $135 billion, the report released on Thursday showed.
The percentage of reserves invested in sovereign bonds rose to 51.4 per cent from 40 per cent six months earlier.
The amount of reserves it held as deposits with other central banks and other financial institutions, such as the Bank of International Settlements and the International Monetary Fund, dropped by more than a third to $102 billion at March 2009 from $160 billion at September 2008.
"The foreign currency assets are invested in multi- currency, multi-asset portfolios as per the existing norms which are similar to the best international practices followed in this regard," the report said.
Foreign direct investment rose to $17.5 billion in 2008/09 from $15.4 billion in 2007-08.
