RBI Data Shows India’s Forex Reserves Reach All-Time High of $642.292 Billion

According to the most recent statistics issued by the Reserve Bank of India (RBI), India’s foreign currency reserves reached an all-time high of 642.292 billion US dollars by the conclusion of the week ending March 15. The RBI also noted that the FX reserves increased for the fourth consecutive week.

The RBI reports that although the foreign exchange reserves increased by $10.470 billion the previous week, India’s foreign exchange increased by 6.396 billion dollars last week.

According to RBI statistics, “India’s foreign currency assets (FCA), the largest component of the forex reserves, increased by USD 6.034 billion to USD 568.386 billion.”

According to the report, India’s gold reserves increased during the course of the week as well, rising from USD 425 million to USD 51.140 billion.

Notably, India’s foreign currency reserves increased by almost $58 billion in the calendar year 2023 compared to a decline of $71 billion in the previous year, according to RBI statistics.

India’s foreign currency reserves last reached an all-time high in October 2021. A significant portion of the subsequent decrease may be attributed to an increase in the price of imported products in 2022.

The RBI’s sporadic market interventions to protect the rupee’s unequal depreciation versus the US dollar’s surge may also be connected to the relative drop in foreign exchange reserves. To keep the rupee from depreciating sharply, the central bank manages market liquidity by selling dollars, among other things.

The Reserve Bank of India (RBI) keeps a tight eye on the foreign currency markets and only steps in to keep the market orderly by limiting excessive volatility in the exchange rate without setting a target level or range.

Currency reserves, often known as foreign exchange reserves, or FX reserves, are assets owned by a country’s central bank or other monetary body. The US dollar is often used as a reserve currency, with smaller amounts maintained in the Euro, Japanese yen, and pound sterling.