India’s Forex Reserves Rebound as RBI Adds $58 Billion This Fiscal Year

Exciting news for India and its global community! The country’s foreign exchange/forex reserves have soared by $4 billion to reach a staggering $620 billion in the week ending December 22, as per the Reserve Bank of India’s latest data released on Friday. With an impressive addition of $57.59 billion this calendar year, the central bank continues to fortify its reserves, showcasing resilience and stability.

The recent surge in total reserves is attributed primarily to a substantial $4.6 billion increment in foreign currency assets. Last week’s uptick propelled reserves to $616 billion, marking the highest level since March 25, 2022. Notably, this surge of $9 billion within the week stands as the second-highest weekly escalation witnessed this financial year.

India’s foreign reserves, in this fiscal year, have secured the fourth spot among major reserve-holding nations, boasting an increase of $28.4 billion. This remarkable rebound follows a challenging 2022 when India experienced a staggering decline of $70 billion in foreign exchange reserves.

The domestic market witnessed robust inflows of foreign investments in 2023, providing substantial support to the rupee amidst global uncertainties. Throughout the year, the Reserve Bank of India remained actively engaged in the market, effectively curbing exchange rate volatility.

The Indian Rupee displayed remarkable stability against the US dollar this calendar year, marking the lowest volatility observed in more than three decades. Notably, the Indian Rupee experienced only a marginal 0.5% depreciation against the greenback. In the ongoing financial year, the rupee has seen a 1.2% depreciation, a stark contrast to the 10% depreciation it faced in 2022 against the US dollar.

Reference:

1. Forex reserves recover after a year of decline, RBI adds $58 bn this fiscal (business-standard.com)