India's foreign exchange reserves hit fresh high of $684bln

PHOTO

India's foreign exchange reserves increased by $2.299 billion, reaching a fresh record high of $683.987 billion, during the week that ended on August 30, according to data released by the Reserve Bank of India (RBI) on Friday.

Asian News International (ANI) reported that the previous record high was $681.688 billion. The reserves have been on an upward trend for some time.

In 2024 alone, they have risen by over $60 billion cumulatively. This buffer of foreign exchange reserves helps insulate domestic economic activity from global shocks.

RBI data shows that India's foreign currency assets (FCA), the largest component of forex reserves, rose by $1.485 billion to $599.037 billion.

Gold reserves during the week increased by $862 million, bringing the total to $61.859 billion. As per estimates, India's foreign exchange reserves are now sufficient to cover about a year of projected imports.

In the calendar year 2023, India added about $58 billion to its foreign exchange reserves.

Forex reserves, or foreign exchange reserves (FX reserves), are assets held by a nation's central bank or monetary authority. These are generally held in reserve currencies, typically the US dollar and, to a lesser extent, the Euro, Japanese Yen, and Pound Sterling.