NewKerala.com

India's Forex Reserves Rise Amid Global Uncertainty: What $687B Means

India's foreign exchange reserves have seen a slight increase, reaching $687.26 billion. This growth was primarily fueled by a significant jump in the country's gold reserves. Despite recent fluctuations, the reserves are still hovering close to their record high. The Reserve Bank of India states these reserves are robust enough to cover more than eleven months of the country's import needs.

Key Points: India Forex Reserves Rise to $687.26 Billion as Gold Jumps

  • Forex reserves rise to $687.26 billion, up $1.03 billion driven by gold
  • Gold reserves jump by $1.03 billion amid global uncertainties and high demand
  • Reserves remain near all-time high of $704.89 billion reached in September 2024
  • RBI actively manages rupee value by buying and selling dollars strategically
2 min read

India's forex reserves rise by $1.03 billion to $687.26 billion

India's forex reserves rise by $1.03 billion to $687.26 billion, driven by a jump in gold holdings. The RBI says reserves can cover over 11 months of imports.

"The country's foreign exchange reserves were sufficient to cover more than 11 months of merchandise imports. - Reserve Bank of India"

New Delhi, December 13

India's foreign exchange reserves rose marginally, by USD 1.033 billion in the week that ended December 5 to USD 687.260 billion, driven by a jump in gold reserves, the Reserve Bank of India's latest 'Weekly Statistical Supplement' data showed. Over the past few weeks, the forex kitty has been largely in a downtrend, except for a few. Still, the country's foreign exchange (forex) kitty is hovering close to its all-time high of USD 704.89 billion, reached in September 2024. For the reported week (that ended December 5), India's foreign currency assets (FCA), the largest component of foreign exchange reserves, stood at USD 556.880 billion, down USD 151 million. The RBI data showed that gold reserves currently stand at USD 106.984 billion, up USD 1.033 billion from the previous week. The price of the safe-haven asset gold has been on a sharp uptrend over recent months, perhaps amid heightened global uncertainties and robust investment demand. After the latest monetary policy review meeting, the RBI had said that the country's foreign exchange reserves were sufficient to cover more than 11 months of merchandise imports.

Overall, India's external sector remains resilient, and the RBI is confident it can comfortably meet external financing requirements.

In 2023, India added around USD 58 billion to its foreign exchange reserves, contrasting with a cumulative decline of USD 71 billion in 2022. In 2024, reserves rose by just over USD 20 billion. So far in 2025, the forex kitty has increased by about USD 47-48 billion, according to data.

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 in the Euro, Japanese Yen, and Pound Sterling.

The RBI often intervenes by managing liquidity, including selling dollars, to prevent a steep depreciation of the rupee. The RBI strategically buys dollars when the Rupee is strong and sells when it weakens.

The Indian rupee has been under pressure for a host of reasons. It has already weakened by over 5 per cent this year on a cumulative basis.

- ANI

Share this article:

Reader Comments

P
Priya S
Good to see reserves are still near the all-time high. It acts as a strong buffer against any external shocks. The RBI seems to be managing it well, especially with the strategic dollar sales to support the rupee.
R
Rohit P
The 5% rupee depreciation this year is worrying for the common man. It makes imports costlier, from petrol to electronics. I hope the RBI's reserves are used effectively to curb excessive volatility. Our purchasing power is getting hit.
S
Sarah B
Interesting to see the data comparison year-on-year. The swing from a $71 billion decline in 2022 to adding $58 billion in 2023 shows significant recovery. The $47-48 billion rise so far in 2025 is also impressive. Shows resilience.
K
Karthik V
While the headline number is comforting, I have a respectful criticism. The article mentions the forex kitty has been "largely in a downtrend." We should focus on attracting more stable FDI and boosting exports to build reserves sustainably, not just through RBI's market operations.
M
Meera T
"Sufficient to cover more than 11 months of imports" – that's the key takeaway for me. It means our economy has a strong safety net. Gives confidence to international investors as well. Good job by the authorities.

We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.

Leave a Comment

Minimum 50 characters 0/50