Forex Update: India’s Foreign Exchange Reserves Hit All-Time High of $651.51 Billion

India’s forex reserves jumped $4.837 billion to a new all-time high of $651.51 billion for the week ended May 31, according to the latest RBI data. Gold reserves, however, fell by $212 million to $56.501 billion during the week ended May 31. The special drawing rights (SDRs) were down $17 million to $18.118 billion.

In the previous reporting week, the overall reserves had fallen by $2.027 billion to $646.673 billion.

“Touching a new milestone, India’s foreign exchange reserves reached a historical high of $651.5 billion as on May 31,” RBI Governor Shaktikanta Das said in his statement while announcing the bimonthly policy review.

The previous high for the kitty a crucial guard against any disturbances in the external sector was $648.87 billion on May 10.

Sanjeev Agrawal, president of the PHD Chamber of Commerce and Industry, said, “It is commendable that, despite global challenges, India’s forex reserves have reached a new all-time high, owing to resilient GDP growth, effective policy initiatives and vigilant monetary policy. India’s significant foreign reserves, at the level of $651 billion, will propel India’s economic growth to new highs, thereby reinforcing its worldwide stature.”

This growth, he said, in forex reserves would strengthen India’s global attractiveness, benefiting its domestic trade and industry. India’s strong foreign exchange reserves will provide the Reserve Bank with greater flexibility in regulating the country’s currency and monetary stance in light of geopolitical distress and global macroeconomic headwinds.

For the week ended May 31, foreign currency assets, a major component of the reserves, increased by $5.065.51 billion to $572.564 billion.

Expressed in dollar terms, the foreign currency assets include the effect of appreciation or depreciation of non-US units like the euro, pound and yen held in the foreign exchange reserves.

India’s reserve position with the IMF was up $1 million to $4.326 billion in the reporting week, the apex bank data showed.