Bank of America expects RBI to build $550-billion forex reserves

Bank of America (BofA) sees $550 billion as a comfortable foreign exchange (forex) reserve level for the Reserve Bank of India (RBI), and believes that the central bank will continue to accumulate dollars at every opportunity, even at the cost of a weaker rupee.

As of February 14, the RBI’s forex  reserves stood at $476 billion. The central bank has bought $49 billion in this fiscal year so far, more than offsetting the $15.4 billion sale in 2018-19.
 

According to BofA, the ‘conservative’ level of forex reserves for the RBI works out to be $550 billion. 

According to BofA’s economists Indranil Sen