India's Forex Reserves Surge To $615 Bn By $9 Bn: RBI
India's foreign exchange reserves surged to USD 615.971 billion in the week ending 15 December 2023, marking one of the highest weekly increments and hitting a 20-month peak, as per data from the Reserve Bank of India.
These reserves encompass various assets like cash, bank deposits, bonds and other financial instruments in currencies other than the Indian rupee. Strengthened reserves enable central banks in developing markets to support their currencies during volatility by supplying dollars to stabilise the market.
The largest segment, foreign currency assets (FCA), climbed to USD 545.048 billion, rising by USD 8.349 billion in the reported week. FCA accounts for the value change in non-US units like the euro, pound, and yen held in the reserves.
Gold reserves also saw an increase, rising by USD 446 million to reach USD 47.577 billion.
India's total foreign exchange reserves had grown from USD 606.859 billion before the December 15 week. Though in October 2021, the reserves reached a historic high of around USD 645 billion, subsequent declines were due in part to increased import costs in 2022.
The decrease in forex reserves was also influenced by RBI interventions to curb rupee depreciation against a strengthening US dollar. Foreign exchange reserves, primarily held in reserve currencies like the US Dollar, Euro, Japanese Yen and Pound Sterling, serve as assets held by a country's central bank to support its liabilities, including the issued native currency and deposits from financial institutions or the government.
