India’s Forex rise by $10.87 billion as RBI buys dollars

India’s foreign exchange reserves went up by $10.87 billion to reach $676.27 billion during the week ended April 4, according to data released by the Reserve Bank of India (RBI) on Friday. The rise in reserves was mainly due to the central bank buying dollars, an increase in gold prices, and changes in the value of foreign currencies. According to the RBI’s weekly statistical  report, Foreign currency assets (FCA), the largest component of the reserves, rose by $9.07 billion to $574.09 billion. The increase in FCA reflects not just the central bank’s purchase of $6.67 billion during the week but also favorable revaluation effects of non-dollar currencies such as the euro, pound, and yen.
Gold reserves also contributed to the rise, climbing $1.57 billion to $79.36 billion, supported by higher global gold prices. In addition, the Special Drawing Rights (SDRs) with the International Monetary Fund (IMF) increased by $186 million to $18.36 billion, while India’s reserve position with the IMF rose by $46 million to $4.46 billion.
This is the fifth week in a row that India’s forex reserves have increased. In the week before, reserves had risen by $6.60 billion to $665.40 billion. The country’s highest-ever reserves were recorded at $704.88 billion in the week ended September 27, 2024. However, with a cumulative addition of $36 billion so far in calendar year 2025, India’s forex position is among the strongest in emerging markets.
According to official estimates, the reserves are sufficient to cover 10–11 months of projected imports, providing a reliable reserve against external shocks and helping to maintain macroeconomic stability. Economists view the RBI’s dollar accumulation strategy as a move to mitigate currency volatility and maintain export competitiveness, especially in light of global capital flows and potential shifts in U.S. monetary policy. 

(Business Correspondent)