India’s foreign exchange (forex) reserves saw a significant increase of $5.158 billion, reaching a new high of $657.155 billion during the week ended July 5, according to the latest data from the Reserve Bank of India (RBI). This surge comes after two consecutive weeks of declines, where reserves dropped by $1.713 billion to $651.997 billion as of June 28.
The previous peak was $655.817 billion recorded on June 7 this year.
Breakdown of India’s Forex Components
The primary driver behind this increase was the foreign currency assets, a major component of the reserves, which rose by $4.228 billion to $577.11 billion. These assets are expressed in dollar terms and reflect the appreciation or depreciation of non-US currencies such as the euro, pound, and yen held within the reserves.
Gold reserves also saw a substantial rise, increasing by $904 million to $57.432 billion. Additionally, special drawing rights (SDRs) went up by $21 million to $18.036 billion, and India’s reserve position with the International Monetary Fund (IMF) increased by $4 million to $4.578 billion.
What Industry Says
Sanjeev Agrawal, President of the PHD Chamber of Commerce and Industry, praised this achievement, attributing it to prudent policy measures and a vigilant monetary stance. “It is highly appreciable that, on the back of prudent policy measures and vigilant monetary policy stance, forex has reached a new all-time high at the level of $657 billion as of July 5, 2024, boosting India’s global stance,” Agrawal said.
He further emphasised that this robust growth in forex reserves would accelerate India’s economic growth, enhance its global attractiveness, and support domestic trade and industry. High foreign exchange reserves provide the RBI with greater flexibility in managing the country’s currency and monetary policy amidst global economic challenges.
