India’s foreign exchange reserves surged to a fresh record high in the week ended January 23, bolstered by a sharp rise in gold holdings and foreign currency assets, according to the latest data released by the Reserve Bank of India.
The country’s forex reserves jumped by USD 8.053 billion during the week to USD 709.413 billion, surpassing the earlier peak of USD 704.89 billion recorded in September 2024. The steady rise over recent weeks underlines the strengthening of India’s external buffers amid global volatility.
Foreign currency assets (FCA), which form the largest component of the reserves, increased by USD 2.367 billion to USD 562.885 billion. Gold reserves saw a sharper jump, rising by USD 5.635 billion to USD 123.088 billion, reflecting both valuation gains and strategic accumulation.
Following its monetary policy review in December, the RBI had stated that India’s foreign exchange reserves were adequate to cover more than 11 months of merchandise imports, indicating comfortable external sector positioning.
Data trends show a significant improvement over recent years. In 2025 so far, reserves have risen by around USD 56 billion, compared with an increase of just over USD 20 billion in 2024. In 2023, the forex kitty grew by about USD 58 billion, reversing the sharp decline of USD 71 billion seen in 2022.
Forex reserves comprise assets held by the central bank in reserve currencies such as the US dollar, euro, Japanese yen and pound sterling. The RBI actively uses these reserves to manage volatility in the rupee, buying dollars during periods of strength and selling them to curb excessive depreciation. |
