India’s forex reserves jump by $305 million to hit over three-month high of $654.27 billion after RBI’s currency swap

India's foreign exchange (forex) reserves increased by $305 million to to a more than three-month high of $654.271 billion during the week ended March 14. In the previous reporting week, the overall reserves rose by $15.267 billion to $653.966 billion and registered the sharpest weekly rise in two years and the biggest jump since August 2021.

The spike in foreign reserves was partly attributed to the $10 billion forex swap done by the Reserve Bank of India (RBI). India's forex reserves have been on a declining trend recently due to the current revaluation, along with forex market interventions by the RBI to help reduce volatilities in the rupee. Forex reserves increased to an all-time high of $704.885 billion in September

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India's forex reserves: Key metrics

For the week ended March 14, 2025, the foreign currency assets (FCA), seen as a major component of the reserves, decreased by $96 million to $557.186 billion. Expressed in dollar terms, the FCA include the central bank's intervention in the forex market and the effect of appreciation or depreciation of non-US units like the euro, pound and yen held in the forex reserves.

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The Special Drawing Rights (SDRs) were up by $51 million to $18.262 billion, the apex bank added. Forex reserves include India's reserve tranche position at the International Monetary Fund (IMF). India's reserve position with the IMF was also up by $283 million at $4.431 billion in the reporting week.

The rupee and most Asian currencies have been volatile due to an uncertain global risk environment, gripped by uncertainties surrounding global trade and growth from constant changes in US tariff plans. The RBI has curtailed volatility in the forex market through dollar sales in the spot market and has conducted dollar-rupee buy-sell swaps to help boost rupee liquidity in the banking system.

According to RBI, gold reserves increased by $66 million to $74.391 billion during the week. In the week to which the reserves data pertains, the rupee depreciated 0.1 per cent week-on-week. The currency ended at 85.9725 on Friday. It rose to a 10-week high of 85.9375 during the session and gained 1.2 per cent in the week.

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