India's foreign exchange reserves have risen to a seven-month high of USD 690.617 billion, an increase of USD 4.553 billion for the week ending 9 May, according to the latest data released by the Reserve Bank of India (RBI).
This is the highest level recorded since September 2024, when reserves touched an all-time peak of USD 704.89 billion. The reserves had seen consistent gains for eight consecutive weeks before a slight dip, only to recover sharply in the latest period.
According to the RBI's breakdown, the country's foreign currency assets (FCA), which constitute the largest component of forex reserves, stood at USD 581.373 billion as of 9 May. Meanwhile, the value of India's gold reserves surged to USD 86.337 billion, reflecting a substantial increase of USD 4.518 billion.
Central banks globally have been increasingly building up their gold holdings as a safeguard against economic uncertainty, and India is no exception. The share of gold in the RBI's foreign exchange reserves has nearly doubled since 2021.
Also read: Gold jumps ₹1,400 to ₹96,450 per 10 gm
Estimates indicate that India's forex reserves are sufficient to cover roughly 10-12 months of projected imports, providing a critical buffer against external economic shocks.
In 2023, India added approximately USD 58 billion to its forex reserves, recovering from a cumulative decline of USD 71 billion in 2022. Last year, reserves grew by just over USD 20 billion.
Foreign exchange reserves, or FX reserves, are assets held by a nation's central bank or monetary authority in various major currencies, including the US Dollar, Euro, Japanese Yen, and Pound Sterling.
The RBI strategically manages these reserves, selling dollars to prevent sharp Rupee depreciation and buying dollars when the domestic currency strengthens.
Follow us
