RBI Reports Forex Reserves Jump By USD 2.3 Billion In Latest Week
India’s foreign exchange reserves (forex) extended their gains, jumping by USD 2.294 billion to reach USD 698.950 billion in the week ending June 13, according to official data released by the Reserve Bank of India (RBI). At the latest monetary policy meeting, RBI Governor Sanjay Malhotra stated that the foreign exchange kitty was sufficient to cover 11 months of the country’s imports and about 96 percent of external debt. With this weekly increase, the forex reserves are nearing their all-time high of USD 704.89 billion recorded in September 2024.
The latest RBI data revealed that India’s foreign currency assets (FCA), the largest component of the foreign exchange reserves, stood at USD 589.426 billion. Additionally, India’s gold reserves currently amount to USD 86.316 billion. Central banks worldwide are increasingly accumulating safe-haven gold as part of their forex reserves, and India is no exception. The share of gold maintained by the RBI in its foreign exchange reserves has nearly doubled since 2021.
In 2023, India added approximately USD 58 billion to its foreign exchange reserves, in stark contrast to a cumulative decline of USD 71 billion in 2022. So far in 2024, the reserves have risen by a little over USD 20 billion. Foreign exchange reserves, or FX reserves, are assets held by a nation’s central bank or monetary authority, primarily in reserve currencies such as the US Dollar, with smaller portions held in the Euro, Japanese Yen, and Pound Sterling.
The RBI often intervenes in the forex market by managing liquidity, including selling dollars, to prevent steep depreciation of the Rupee. The central bank strategically buys dollars when the Rupee is strong and sells them when it weakens, helping to maintain currency stability.
(From ANI)
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