India’s Forex Reserves Hit $716.90 Billion: What Is Driving The Rise?

India’s foreign exchange reserves climbed $9.905 billion to $716.90 billion in the week ended August 14, according to Reserve Bank of India data released on Friday.

The latest rise followed a $14.1 billion surge in the previous week. Reserves had then crossed $707 billion, marking their highest level in the current financial year.

Inflows through the RBI’s FCNR(B) deposit scheme supported the latest increase. These inflows began reflecting in India’s reserve position during the week.

Foreign currency assets remained the largest contributor. They increased by $7.2 billion to $581.85 billion.

Gold reserves registered a sizeable rise of $2.67 billion to $111.41 billion.

The strong build-up has reinforced India’s external sector buffers. It offers greater protection against global economic and financial volatility.

During the week ended August 7, reserves rose by $14.136 billion.

The increase pushed the stock beyond $707 billion. Stronger foreign currency assets and gold holdings drove that expansion.

In rupee terms, reserves had expanded by Rs 1.19 lakh crore during that reporting week. They reached Rs 67.32 lakh crore, highlighting the resilience of India’s external position.

Foreign currency assets led that earlier increase as well. FCAs rose by $9.946 billion to $574.625 billion.

Gold reserves advanced by $3.995 billion to $108.738 billion.

India’s Special Drawing Rights with the International Monetary Fund increased by $79 million to $18.745 billion.

The latest accretion in reserves provides India with a stronger cushion against external shocks and changing global financial conditions.

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