India's forex reserves jump $6.3 billion to $696.99 billion on surge in gold holdings
Mumbai, May 15
India's foreign exchange reserves rose sharply by $6.295 billion to $696.988 billion during the week ended May 8, mainly driven by a significant increase in gold reserves, according to data released by the Reserve Bank of India on Friday.
The latest rise comes after the country's forex reserves had declined by $7.794 billion to $690.693 billion in the previous reporting week.
India's foreign exchange reserves had earlier touched a record high of $728.494 billion in the week ended February 27.
However, reserves came under pressure after the outbreak of the Middle East conflict, which led to sustained interventions by the RBI in the foreign exchange market to stabilise the rupee.
According to the central bank's data, foreign currency assets (FCAs), which form the largest component of the reserves, increased by $562 million to $552.387 billion during the reporting week.
The RBI said foreign currency assets expressed in dollar terms include the impact of appreciation or depreciation of non-US currencies such as the euro, pound and yen held in the reserves.
Gold reserves recorded the biggest jump among reserve components, rising by $5.637 billion to $120.853 billion during the week under review.
Meanwhile, the value of Special Drawing Rights (SDRs) increased by $84 million to $18.873 billion.
India's reserve position with the International Monetary Fund also rose by $12 million to $4.875 billion, the RBI data showed.
Meanwhile, the country's foreign exchange reserves had registered a $2.3 billion increase in the week ending April 17.
The country's forex reserves rose to reach $703.30 billion, the central bank said on April 28.
The movement in forex reserves continues to reflect India's balancing act between managing external shocks and maintaining currency stability amid an uncertain global economic environment.
— IANS
Reader Comments
Great to see the reserves bouncing back after last week's drop. But $696 billion is still far from the record $728 billion - we need to tackle those external shocks better. The RBI is doing its best though. 🇮🇳
I'm no economist but gold jumping by $5.6 billion in one week? That's huge! Either the RBI bought a ton or the gold price skyrocketed. Either way, it's a good buffer against global uncertainty. Let's hope we reach $730 billion soon.
The government should focus on reducing imports and boosting exports instead of just celebrating these numbers. Forex reserves are important but they don't directly help the common man facing inflation.
Impressive resilience from the Indian economy. The SDR and IMF positions also rising shows increasing global integration. But I'd like to see more clarity on how these reserves are being deployed for economic growth.
Good to see this recovery after last week's big drop. The RBI is clearly managing the rupee well despite all the global chaos. But I feel the focus should be on making our manufacturing stronger so we don't have to rely so much on forex reserves.
Excellent move by the RBI to increase gold reserves
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