New Delhi: India’s foreign exchange reserves rose sharply by $4.553 billion, reaching $690.617 billion for the week ending May 9, the Reserve Bank of India (RBI) reported on Friday. The surge was largely attributed to a significant increase in gold reserves.
In contrast, the previous week saw a decline of $2.065 billion, bringing total reserves to $686.064 billion. Despite the recent fluctuations, the reserves remain close to the record high of $704.885 billion, achieved in September 2024.
According to RBI data, gold reserves saw a substantial increase of $4.518 billion, reaching $86.337 billion, marking the primary contributor to the week’s overall gains.
Other Components of Reserves
• Foreign Currency Assets (FCA), the largest component of the reserves, rose modestly by $196 million to $581.373 billion.
• Special Drawing Rights (SDRs), allocated by the International Monetary Fund (IMF), declined by $26 million, settling at $18.532 billion.
• India’s reserve position with the IMF also fell by $134 million to $4.374 billion.
The FCA figures reflect the impact of currency movements involving non-US dollar assets such as the euro, pound, and yen.
India’s forex reserves serve as a critical buffer to manage currency volatility, support trade, and maintain investor confidence. The recent rise, especially in gold holdings, underscores the central bank’s diversification strategy amid global economic uncertainties.
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