India’s forex reserves reach $615.97 billion, highest in 20 months

India’s foreign exchange (FX) reserves rose for the fifth time in the week ending December 15, touching an over 20-month high of $615.97 billion- the highest level since March 2022.

FX reserves increased by $9.11 billion during the week, one of the highest weekly increases ever and the second highest in FY24 so far, according to market participants, who added that the surge in reserves is likely on the back of a decrease in imports and softening in crude oil prices.

In the previous week ended December 8, reserves had risen by $2.82 billion to $606.86 billion, as per the Reserve Bank of India (RBI) data.

Within reserves, foreign currency assets increased by $ 8.35 billion to $545.05 billion as of December 15, whereas gold reserves rose $446 million to $47.58 billion. Special Drawing Rights (SDRs) were up $135 million to $18.32 billion. Further, data showed that India’s reserve position with the IMF stood at $5.02 billion, $181 million higher on the week.

FX reserves are usually dependent on the central bank’s activity in the forex market as well as valuation changes in the currencies held. They had touched an all-time high of $645 billion in October 2021.

For the week ended December 15, the rupee closed at 83.03, up by 27 paise over the previous close of 83.30 and higher by 37 paise on a weekly basis, largely on the back of a decline in the dollar index.