India's forex reserves rise $3.5 billion to $694.2 billion in latest week, supported by foreign currency assets, gold

India's foreign exchange reserves rose by USD 3.5 billion in the week that ended August 29 to USD 694.230 billion, driven largely by a rise in foreign currency assets and gold, the Reserve Bank of India (RBI) said in its latest 'Weekly Statistical Supplement'. The country's forex kitty is hovering close to its all-time high of USD 704.89 billion touched in September 2024.

For the reported week, India's foreign currency assets (FCA), the largest component of foreign exchange reserves, stood at USD 583.937 billion, a rise of USD 1.7 billion.

The RBI data showed that the gold reserves currently amount to USD 86.769 billion, witnessing a rise of USD 1.8 billion.

After the latest monetary policy review meeting, RBI Governor Sanjay Malhotra said the foreign exchange kitty was sufficient to meet 11 months of the country's imports.

In 2023, India added around USD 58 billion to its foreign exchange reserves, contrasting with a cumulative decline of USD 71 billion in 2022.

In 2024, the reserves rose by a little over USD 20 billion. So far in 2025, the forex kitty has cumulatively increased by about USD 53 billion, according to data.

Foreign exchange reserves, or FX reserves, are assets held by a nation's central bank or monetary authority, primarily in reserve currencies such as the US Dollar, with smaller portions in the Euro, Japanese Yen, and Pound Sterling.

The RBI often intervenes by managing liquidity, including selling dollars, to prevent steep depreciation of the rupee. The RBI strategically buys dollars when the Rupee is strong and sells when it weakens.