The weekly reports from RBI (for week ending 21st May 2004) indicates that for the first time this financial year, forex reserves has declined. It has been going up consistently for several weeks at a stretch.
Some of the reasons are
- Foreign institutional investors (FIIs) were net sellers in the stock markets, resulting in foreign exchange outflow from India
- Declining value of Rupee vs Dollar, and against Pounds, Euro and Yen
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