According to the Weekly Statistical Supplement released by the RBI, Foreign currency assets (FCAs) increased by $2.57 billion to $588.05 billion. Expressed in dollar terms, the FCAs include the effect of appreciation or depreciation of non-US units like the euro, pound and yen held in the foreign exchange reserves.
Gold reserves expanded by $1.32 billion to $59.99 billion, whereas SDRs were up by $95 million to $18.20 billion.
Reserve position in the IMF was remained unchanged at $4.60 billion.
Sanjeev Agrawal, President, PHD Chamber of Commerce and Industry said that India’s strong stance despite geopolitical uncertainties, prudent policy measures and vigilant monetary policy stance, have led the FOREX to reach the new all-time high at the level of USD 670 billion (as on July 19, 2024).”This will propel India’s economic growth on a higher trajectory, enhancing its standing internationally, making the country attractive to foreign investors, and fostering domestic trade and industry. Given, the global macroeconomic challenges, the Reserve Bank of India would have more flexibility in handling the currency and monetary policy due to the country’s significantly high foreign exchange reserves,” he added.Typically, the RBI, from time to time, intervenes in the market through liquidity management, including through the selling of dollars, with a view to preventing a steep depreciation in the rupee.
The RBI closely monitors the foreign exchange markets and intervenes only to maintain orderly market conditions by containing excessive volatility in the exchange rate, without reference to any pre-determined target level or band.