India’s foreign exchange reserves saw a decline of USD 3.71 billion, reaching USD 701.18 billion for the week ending October 4., as per RBI. This comes after the reserves had surged by a record USD 12.59 billion in the previous week, hitting an all-time high of USD 704.89 billion.
The decline was largely attributed to a reduction in foreign currency assets, which fell by USD 3.51 billion to USD 612.64 billion. These assets, denominated in US dollars, reflect the valuation of various global currencies like the euro, pound, and yen that make up India’s reserves.
Gold reserves also dipped slightly by USD 40 million, bringing the total to USD 65.76 billion. Additionally, the country’s Special Drawing Rights (SDRs) with the International Monetary Fund (IMF) decreased by USD 123 million to USD 18.43 billion, while India’s reserve position with the IMF saw a drop of USD 35 million, standing at USD 4.35 billion.
The recent drop in forex reserves follows a period of strong growth, highlighting the volatility in global currency markets and shifts in the valuation of key reserve components. This fluctuation underscores the dynamic nature of India’s external reserves in response to global economic conditions.
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