Finance
India’s foreign exchange reserves increased by $4.69 billion to $702.9 billion in the week ended September 12, according to figures provided by the Reserve Bank of India (RBI) on Friday.
With this rise, the reserves are now less than $2 billion away from their all-time high of $704.9 billion, set in late September 2024.
According to the most recent RBI data, foreign currency assets, which account for the vast majority of reserves, increased by $2.5 billion to $587.04 billion.
These assets include key world currencies like the euro, pound, and yen, and their dollar worth varies with exchange rates.
This week, gold reserves surged by $2.1 billion to $92.42 billion.
The special drawing rights (SDRs) rose marginally by $32 million to $18.73 billion, while India’s reserve position with the International Monetary Fund (IMF) climbed by $9 million to $4.76 billion.
Forex reserves serve as the country’s financial safety net, allowing the RBI to intervene in the currency market as needed to reduce rupee volatility.
The central bank maintains that such interventions are not intended to fix the currency rate at a specific level, but rather to provide stability in times of global uncertainty.
Reserves have risen steadily in recent times. They had already surpassed the $698 billion threshold in the week ending September 5, following a $4.03 billion increase after rising $3.51 billion the previous week.
The Central Bank’s report from the previous week also revealed that foreign currency assets (FCAs), the largest component of reserves, increased by $540 million to $584.47 billion.
Analysts believe that India’s strong buffer, which is close to record highs, would assist to absorb external shocks, strengthen the currency, and provide foreign investors with confidence, particularly in light of uncertain global economic conditions.
Source: IANS
