India Forex Reserves Surge USD 1.08 Billion to USD 676.24 Billion

India's foreign exchange reserves have experienced a notable increase of USD 1.08 billion to reach a total of USD 676.24 billion, as per recent data released by the Reserve Bank of India (RBI). This marks the second consecutive weekly gain for the country's foreign exchange reserves, following a USD 964 million addition in the preceding week.

The primary driver behind this growth is the significant rise in Foreign Currency Assets (FCAs), which expanded by USD 4.549 billion to reach USD 551.057 billion during the reporting week. This increase reflects valuation changes resulting from fluctuations in non-USD currencies, such as the euro and Japanese yen.

In contrast, India's gold reserves saw a decline of USD 3.48 billion, falling to USD 101.749 billion. Special Drawing Rights (SDRs) with the International Monetary Fund (IMF) rose by USD 44 million to USD 18.67 billion, while India's reserve position with the IMF decreased by USD 32 million to USD 4.761 billion.

This uptick in foreign exchange reserves offers relative stability after a turbulent few months for the central bank's foreign reserves. Following geopolitical tensions and conflict in the Middle East, the RBI stepped into the foreign exchange market, selling USD to curb excessive currency volatility and support domestic market stability.