India's forex reserves rise for 5th straight week, hit all time-high

India forex exchange:  As per the latest data released by the Reserve Bank of India (RBI), India's foreign exchange reserves rose for the fifth straight week to hit a fresh all-time high of USD 642.631 billion in the week ending on March 22. 

Prior to the week that ended on March 22, the foreign exchange kitty rose by USD 6.396 billion.
Last week, India's foreign currency assets (FCA), the biggest component of the forex reserves, though, declined by USD 123 million to USD 568.264 billion. 

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Gold reserves during the week rose from USD 347 million to USD 51.487 billion.

In 2023, the RBI increased its foreign exchange reserves by approximately $58 billion.

However, in 2022, India's forex reserves declined by a total of $71 billion. 

Forex reserves, also known as foreign exchange reserves, are assets held by a country's central bank, typically in reserve currencies like the US Dollar, Euro, Japanese Yen, and Pound Sterling.

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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.

The RBI closely monitors the foreign exchange markets and intervenes only to maintain orderly market conditions by containing excessive volatility in the exchange rate, without reference to any pre-determined target level or band. 

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(With inputs from agencies)

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