India Enters Exclusive Club: Fourth Nation To Cross $700 Billion In Forex Reserves— All You Need To Know

For the first time ever, India's foreign exchange (forex) reserves have surpassed the $700 billion mark, continuing a remarkable streak of seven consecutive weeks of growth.

With this achievement, India joins China, Japan, and Switzerland as the fourth economy worldwide to cross $700 billion in forex reserves.

The forex reserves surged by $12.588 billion, reaching a new all-time high of $704.885 billion for the week ending 27 September.

This marks the largest weekly increase since mid-July 2023, fuelled by valuation gains and dollar purchases made via the Reserve Bank of India (RBI).

During the week for which the latest reserves data is available, the Indian rupee strengthened past 83.50 to the dollar, likely spurring the RBI to shore up its reserves.

In the previous week, the forex reserves had increased by $2.838 billion to $692.296 billion.

So far in 2024, India's forex reserves have surged by $87.6 billion, significantly exceeding the nearly $62 billion increase observed over the whole of last year.

This substantial buffer of foreign exchange reserves plays a vital role in protecting domestic economic activity from potential global disruptions.

According to latest data from the RBI, India's foreign currency assets (FCA)—the largest component of forex reserves—rose by $10.468 billion to reach $616.154 billion.

Expressed in dollar terms, the foreign currency assets include the effect of appreciation or depreciation of non-US units like the euro, pound, and yen held in the foreign exchange reserves.

India's gold reserves increased by $2.184 billion to $65.796 billion during the week.

The Special Drawing Rights (SDRs) were up by $8 million to $18.547 billion.

However, India's reserve position with the International Monetary Fund (IMF) was down by $71 million to $4.387 billion in the reporting week.

The surging reserves have been facilitated by overseas inflows into India’s stocks and bonds.

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