Yes. If you under eat, your body goes into something called starvation mode and refuses to shed fat. If you eat a more sensible amount of calories, some of which can be burned through exercise, that's okay.
1lb of added muscle burns an exta 45-50 calories, but conversely if you reduced your calories to the point, that you significantly cut previous protein intake, you could lose some muscle and potentially replace it with fat. I've seen some people purport to eat healthy food, but in small portions and wonder why their weight went down, but then actually went back up, even though their diet had remained good and that could have been the reason.
Muscle loss contributing to fat gain.
Also the extra calories come with extra nutrients. If you under eat and then lose a lot of bone healthy nutrients from your diet, like Calcium, Vit K2, Phosphorous, Vit D, Copper, Vit C, Magnesium etc etc, that play either a direct or indirect role in bone formation, you could thin the bones, to a point that certain exercise patterns or types, could become intolerant to your bones and you could then encourage fractures or possibly bone damage of some other kind.
I'm not advocating you suddenly increase calories by 2,000 a day, as that would be encouraging the opposite of what you want to happen, but you look like you're potentially eating 1,000 or less calories a day, which won't help.
What I have proposed is what I think will help and therefore if you eat how I suggested, I'm sure after a month, you'll notice a positive difference

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