<p><strong>By Anirban Nag</strong><br />India’s foreign-exchange reserves plunged the most in about eight years as the central bank stepped in to defend the rupee. </p>.<p>The reserves fell by $5.35 billion to $481.9 billion in the week ended March 13, according to data published by the Reserve Bank of India. That’s the most since November 2011 when the hoard dropped $5.7 billion, according to data compiled by Bloomberg.</p>.<p>The rupee weakened against the dollar as turmoil engulfed the global financial markets triggered by the coronavirus pandemic, and fell to a record low on Thursday amid persistent selling by foreign portfolio investors. They have pulled out a record $10 billion from Indian shares and bonds so far this month.</p>.<p>Local equities have fallen to a three-year low, while corporate bond markets have faced selling pressure due to tighter liquidity conditions after the central bank placed a large private bank under moratorium.</p>.<p>Nevertheless, falling oil prices and slowing imports due to subdued domestic consumption are likely to offer some buffer to reserves, which are strong enough to cover nearly 10 months of imports.</p>
<p><strong>By Anirban Nag</strong><br />India’s foreign-exchange reserves plunged the most in about eight years as the central bank stepped in to defend the rupee. </p>.<p>The reserves fell by $5.35 billion to $481.9 billion in the week ended March 13, according to data published by the Reserve Bank of India. That’s the most since November 2011 when the hoard dropped $5.7 billion, according to data compiled by Bloomberg.</p>.<p>The rupee weakened against the dollar as turmoil engulfed the global financial markets triggered by the coronavirus pandemic, and fell to a record low on Thursday amid persistent selling by foreign portfolio investors. They have pulled out a record $10 billion from Indian shares and bonds so far this month.</p>.<p>Local equities have fallen to a three-year low, while corporate bond markets have faced selling pressure due to tighter liquidity conditions after the central bank placed a large private bank under moratorium.</p>.<p>Nevertheless, falling oil prices and slowing imports due to subdued domestic consumption are likely to offer some buffer to reserves, which are strong enough to cover nearly 10 months of imports.</p>