New All India SEBI Grade A Scholarship Test on June 11, 2023
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Question

What the NOT Correct about Foreign Exchange Reserves of India?

i. US dollar has highest share in the Forex reserves.

ii. The reserves are managed by the Reserve Bank of India for the Indian government

iii. Reserve Bank of India accumulates foreign currency reserves by purchasing from authorized dealers in open market operations.

A Only i & ii Correct Answer Incorrect Answer
B Only i & iii Correct Answer Incorrect Answer
C Only ii Correct Answer Incorrect Answer
D Only iii Correct Answer Incorrect Answer
E All the above are correct Correct Answer Incorrect Answer

Solution

Foreign exchange reserves (also called forex reserves or FX reserves) are cash and other reserve assets held by a central bank or other monetary authority that are primarily available to balance payments of the country, influence the foreign exchange rate of its currency, and to maintain confidence in financial markets

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