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US dollar to continue to dominate India’s foreign exch. reserves, says RBI

The US dollar will remain a major component of India’s foreign exchange reserves as most of the country’s overseas trade is in this denomination, Reserve Bank of India (RBI) deputy governor KC Chakrabarty said on Friday.

"The euro is not a significant component in [India’s] total reserves. Our major reserves will always be in US dollars as 90 percent of trade is in this currency," says Chakrabarty.

He said the US dollar’s rise against major currencies would impact the Indian rupee as well and the RBI is not in a position to stop the slide in its local currency.