2025 April, 5, 04:18:45 PM

India's Forex Reserves Reach Near 5-Month High

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India's foreign exchange reserves have surged to a near five-month high, reflecting increased foreign investment and a strengthening rupee. Here's a breakdown of the key details:

Key Highlights:

  • Reserves Climbed: India's foreign exchange reserves rose for the fourth consecutive week, reaching USD 665.4 billion as of March 28.
  • Significant Increase: The reserves increased by USD 6.6 billion in the latest reporting week, following a total rise of USD 20.1 billion over the previous three weeks.
  • Rupee Gains: The Indian rupee gained 0.6 per cent over the week, supported by the return of foreign investors to Indian stock markets.

Factors Influencing the Reserves:

Changes in the reserves are primarily influenced by:

  • The central bank’s activities in the currency market (buying or selling).
  • Fluctuations in the value of foreign assets held by the central bank.

Rupee's Performance:

In recent months, the rupee faced downward pressure due to foreign money outflows and a strong US dollar. However, with the reversal of these trends, the rupee has shown recovery:

  • The rupee ended the week at 85.2350 per US dollar, up 0.3 per cent from the previous week.
  • Over the last two weeks, the rupee has gained about 2 per cent overall.

Composition of India’s Forex Reserves:

India’s forex reserves include:

  • Foreign currency assets
  • Gold holdings
  • Reserve Tranche Position with the International Monetary Fund
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