MUMBAI, MAY 17: The foreign exchange reserves of the country have crossed the $ 23 billion mark. This is the first time that the forex reserves have reached this level.

The foreign currency assets of the Reserve Bank of India jumped to $23.32 billion on May 9 from $22.67 billon a fortnight ago. The total forex reserves including gold and SDRs during the fortnight rose from $ 26.75 billion to $27.28 billion.

The present level of foreign currency assets covers eight months of imports of the country, market analysts said. In the first five weeks of the current fiscal, forex reserves increased by over 1.6 billion.

There has been a steady rise in country's forex reserves over the past few weeks, primarily due to Reserve Bank's continuous buying of dollars from the market and a slowdown in imports, analysts said.

On March 28, the foreign currency assets stood at $21.69 billion (total reserve: $25.67 billion) which rose to $22.31 billion ($26.36 billion) on April 4, $22.43 billion ($26.49 billion) on April 11, $ 22.50 billion ($26.56 billion) on April 17 and $22.67 billion ($26.75 billion) on April 25. On a year-on-year basis, the jump is over $6 billion.

The continuous surge in foreign assets was also attributed to an import slowdown. Both oil and non-oil imports are coming down owing to sluggishness in the economy. Combined with this, foreign direct investments (FDI) and funds brought in by foreign institutional investors (FIIs) have had a positive impact on the forex reserves.

The rise in forex reserve is likely to be sustained as there is no let up the Reserve Bank's aggressive intervention in the forex markets to prop up the dollar. ``The central bank will continue to intervene to strengthen the dollar keeping in mind the inflation differential between India and the US,'' analysts said.

However, the intervention is unlikely to have any effect on money supply. ``Despite the intervention, money supply will be kept under control,'' an RBI source said.

The year-on-year M3 growth was 16.1 % on April 25, 1997, down from 16.6 % the previous fortnight.