At USD 642.29 Billion, India’s Foreign Exchange Reserves Hit All-Time High

India’s foreign exchange reserves rose for the fourth straight week to hit an all-time high of USD 642.292 billion in the week ending on March 15, as per the latest data released by the Reserve Bank of India (RBI). During the week, the foreign exchange kitty rose by USD 6.396 billion.

Before March 8 week, the reserves rose by USD 10.470 billion to USD 636.095 billion.

During the latest week, India’s foreign currency assets (FCA), the biggest component of the forex reserves, rose by USD 6.034 billion to USD 568.386 billion, the central bank’s weekly statistical data showed.

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In October 2021, the country’s foreign exchange reserves last touched their all-time high. Much of the decline after that could be attributed to a rise in the cost of imported goods in 2022.

Also, the relative fall in forex reserves could be linked to the RBI’s intervention, from time to time, in the market to defend the uneven depreciation in the rupee against a surging US dollar.

Typically, the RBI, from time to time, intervenes in the market through liquidity management, including through the sale of dollars, to prevent a steep depreciation in the rupee.