India's Forex Reserves Witness Largest Weekly Jump In Four Months

India’s foreign exchange reserves experienced the most substantial weekly surge in four months, soaring by USD 12.74 billion to reach an impressive USD 609.02 billion, as reported by the Reserve Bank of India (RBI) on Friday.

According to the RBI's Weekly Statistical Supplement, the Foreign Currency Assets (FCAs) were the main contributors to this substantial increase, surging by USD 11.19 billion and bringing the total FCAs to USD 540.17 billion. The FCAs encompass the effect of appreciation or depreciation of non-US units, such as the euro, pound, and yen, held in the foreign exchange reserves.

In addition to the growth in FCAs, India's gold reserves also experienced a notable uptick, rising by USD 1.14 billion to USD 45.20 billion. The Special Drawing Rights (SDRs), an international reserve asset created by the International Monetary Fund (IMF), increased by USD 250 million, reaching USD 18.5 billion. Moreover, the Reserve Position in the IMF also saw growth, moving up by USD 158 million to USD 5.18 billion.

The RBI's data, released as part of its monthly bulletin, revealed that the central bank had bought a substantial amount of USD 7.37 billion in the spot foreign exchange market in May. Interestingly, no dollars were sold during that month. In the preceding month of April, the RBI had bought a net of USD 7.70 billion in the spot market. This data coincides with the observation that the Indian rupee depreciated by over 1 per cent against the dollar in May.