Gold rally drives India’s forex reserves to $698.3 billion

India’s foreign exchange reserves rose marginally closer to their all-time high, rising to $698.3 billion as of September 5, according to data released by the Reserve Bank of India (RBI) on Friday. The reserves are now just $6.6 billion short of the record peak of $704.9 billion reached in late September 2024. 
The weekly increase of $4 billion was largely driven by a surge in gold prices, which touched record levels during the week. The value of gold holdings, accounting for about 13% of India’s total reserves, jumped by $3.5 billion compared to the previous week. Foreign currency assets, which form the largest component of reserves, also rose by $540 million to $584 billion. These assets are held as a diversified portfolio of major currencies—including the US dollar, euro, pound sterling, and Japanese yen—though expressed in dollar terms.
The steady rise in reserves underscores the combined impact of strong gold valuations and stable foreign exchange inflows, bringing India within touching distance of its record reserve levels once again.

(Business Correspondent)