India's Forex Reserves Plunge $14.9 Billion Amid Rupee Pressure

India's foreign exchange reserves dropped by $14.9 billion to $765.9 billion in the week ended September 18, marking the steepest weekly fall since November 15, 2024.

The decline comes after a sharp increase in recent weeks, with holdings reaching a record $785.7 billion in the week ended September 5 due to foreign currency inflows through the RBI's FCNR(B) deposit swap scheme.

Foreign currency assets, the largest component of India's reserves, fell by $14.8 billion to $631 billion during the week.

The rupee faces pressure from higher crude oil prices and US Treasury yields, prompting the RBI to use spot and forward market operations to manage excessive volatility in the currency.