India’s foreign exchange reserves witnessed a significant boost in the week ending July 7, according to the Reserve Bank of India. The reserves surged by USD 1.229 billion to reach USD 596.28 billion, showcasing a positive trend. In the preceding reporting week, the reserves had already experienced a rise of USD 1.85 billion, reaching USD 595.05 billion. However, it is worth noting that the country’s forex kitty had achieved an all-time high of USD 645 billion back in October 2021. Unfortunately, the reserves have been gradually declining as the central bank utilizes them to protect the Indian rupee from the pressures primarily stemming from global developments.
When examining the components of India’s foreign exchange reserves, the Weekly Statistical Supplement released by the RBI reveals that foreign currency assets, which constitute a significant portion of the reserves, demonstrated an increase of USD 989 million during the week, reaching USD 528.968 billion. These foreign currency assets encompass the impact of fluctuations in non-US units, such as the euro, pound, and yen, held within the forex reserves.
In addition to the foreign currency assets, gold reserves also observed a rise. The RBI reported that gold reserves grew by USD 228 million, reaching USD 44.06 billion. Meanwhile, the Special Drawing Rights (SDRs) experienced a slight decline of USD 4 million, totaling USD 18.235 billion.
Regarding the country’s reserve position with the International Monetary Fund (IMF), there was a positive increase of USD 15 million during the reporting week, as per the RBI data. The reserve position with the IMF reached USD 5.017 billion, showcasing a strengthening position in international financial relations.
Overall, India’s foreign exchange reserves demonstrated fluctuations during the week ending July 7, with notable increases in foreign currency assets and gold reserves. These developments have implications for the stability and management of the Indian rupee amid global economic conditions.
