CSEET · Economic and Business Environment · Global Environment
Which of the following is treated as part of a country's foreign exchange reserves?
Foreign currency assets held by the central bank form part of foreign exchange reserves, along with the bank's gold, special drawing rights and the IMF reserve tranche position. Rupee deposits, rupee bonds and household jewellery are domestic assets and not reserves.
- AForeign currency assets held by the central bankCorrect
- BRupee deposits of residents in domestic banks
- CGovernment of India rupee bonds held by Indian banks
- DDomestic gold jewellery held by households
Explanation
Reserves comprise foreign currency assets, gold held by the central bank, special drawing rights and the reserve tranche position with the IMF. Rupee deposits, rupee bonds and household jewellery are domestic holdings and are not reserves.
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