India’s foreign exchange reserves declined sharply by USD 9.809 billion to USD 686.801 billion in the week ended January 2, according to data released by the Reserve Bank of India (RBI). The fall comes after a rise of USD 3.293 billion in the previous week, highlighting volatility in global financial markets and currency movements.
The decline was mainly driven by a drop in foreign currency assets (FCAs), which fell by USD 7.622 billion to USD 551.99 billion. FCAs are influenced not only by capital flows but also by valuation changes in major currencies such as the euro, pound sterling, and Japanese yen against the US dollar.
India’s gold reserves also decreased by USD 2.058 billion to USD 111.262 billion. Additionally, Special Drawing Rights (SDRs) with the IMF declined marginally to USD 18.778 billion, while India’s reserve position with the IMF slipped to USD 4.771 billion.
Despite the weekly fall, India’s forex reserves remain near record-high levels, providing a strong buffer against external shocks. The RBI continues to use reserves to manage rupee volatility and ensure stability in the foreign exchange market, making reserves a key pillar of India’s macroeconomic strength.
