Forex watch: India’s foreign exchange reserves drop to $697.78 billion

India’s foreign exchange reserves fell by $2.176 billion to $697.784 billion in the week ended October 10, according to data released by the Reserve Bank of India (RBI) on Friday.This marks the second consecutive weekly decline after reserves had dipped by $276 million in the previous week to $699.96 billion.Foreign exchange reserves serve as a vital buffer against external shocks such as oil price fluctuations, currency volatility, and global financial instability. The RBI manages these reserves to maintain financial stability and ensure confidence in India’s external position.Meanwhile, the rupee pared early gains and closed 7 paise lower at 88.03 (provisional) against the US dollar on Friday. The local currency opened at 87.91, touched an intraday high of 87.75, but slipped later due to trade tensions and global uncertainty.Forex traders said foreign fund inflows and easing crude prices helped limit the rupee’s losses despite overall market caution.(With inputs from agencies)