India’s foreign exchange reserves saw a significant increase of $6.295 billion, reaching $696.988 billion by the week ending May 8. This rise was primarily attributed to a notable surge in gold reserves, as per data released by the Reserve Bank of India.
The country’s forex reserves had experienced a decline of $7.794 billion in the previous reporting week, dropping to $690.693 billion. Earlier, India had achieved a record high of $728.494 billion in reserves by the week ending February 27.
Amid the Middle East conflict outbreak, the reserves faced pressure, leading to sustained interventions by the RBI in the foreign exchange market to stabilize the rupee. Foreign currency assets (FCAs), the largest component of the reserves, increased by $562 million to $552.387 billion during the reported week, according to the central bank’s data.
Gold reserves witnessed the most significant rise among reserve components, surging by $5.637 billion to $120.853 billion during the review week. Additionally, the value of Special Drawing Rights (SDRs) increased by $84 million to $18.873 billion, while India’s reserve position with the International Monetary Fund rose by $12 million to $4.875 billion, as per RBI data.
The movement in forex reserves reflects India’s efforts to manage external shocks and uphold currency stability amidst a globally uncertain economic landscape.
