File Photo: South Korea Won, Chinese yuan and Japanese notes have $ 100 bills in this illustration | Photo credit: Kim Hong-Ji
India currency reserves increased $ 10,872 billion to $ 676.26 billion in the week that ended on April 4, extending profits for the fifth consecutive week, official data published by RBI.
Except for the last jump, Forex reserves had collapsed for about four months, recently reaching a minimum of 11 months. Then the last roller mountain movement followed, with profits a few weeks and decreases the next. Forex reserves began after touching a historical maximum of $ 704.89 billion in September. Now they are lower since its peak.
The decrease in reserves was probably due to RBI intervention, with the aim of preventing acute depreciation of rupee. Indian rupee is now in or near its historical minimum or near the US dollar.
RBI’s latest data showed that the foreign currency (FCA) assets of India, the largest component of Forex reserves, stood at $ 574.08 billion. Gold reserves currently amount to $ 79,360 billion, according to RBI data.
Estimates suggest that Indian currency reserves are sufficient to cover approximately 10-11 months of projected imports. In 2023, India added about $ 58 billion to its foreign exchange reserves, cons with an accumulated decrease or $ 71 billion in 2022. In 2024, the reserve increased a little more than $ 20 billion. Currency reserves, or FX reserves are active in the possession of a central bank of nations or monetary authority, mainly in reserve currencies such as the US dollar, with smaller portions in the euro, the Japanese yen and the sterling pound.
The intervention RBI when managing liquuidity, including the sale of dollars, to avoid the strong depreciation of the rupee. The RBI strategically buys dollars when the rupee is strong and sells when weakens.
Posted on April 12, 2025
