India’s foreign exchange reserves rose by $6.1 billion to a nearly two-month high of $682.35 billion in the week ended July 24, according to data released by the Reserve Bank of India (RBI) on Friday.
The latest increase follows a $1.08 billion rise in the previous reporting week, when the country’s forex reserves stood at $676.23 billion. The latest build-up marks the highest level of reserves since late May.
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Earlier this year, in February, India’s forex reserves had scaled a record high of $728.494 billion. The reserves, however, declined in the following weeks amid heightened geopolitical tensions in the Middle East, which weighed on the rupee and prompted the RBI to intervene in the foreign exchange market through dollar sales to curb excessive volatility.
Notably, Prime Minister Narendra Modi has made multiple appeals since May 11, urging citizens to conserve foreign exchange by reducing overseas travel, limiting fuel consumption and avoiding gold purchases for a year.
Foreign currency assets (FCAs), the largest component of the reserves, increased by $4.8 billion to $555.92 billion during the reporting week, RBI data showed.
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FCAs, expressed in dollar terms, include the impact of appreciation or depreciation of non-US currencies such as the euro, pound sterling and Japanese yen held in the country's foreign exchange reserves.
Gold reserves also registered a healthy increase, rising by $1.3 billion to $103.05 billion during the week.
Meanwhile, Special Drawing Rights (SDRs) with the International Monetary Fund (IMF) declined by $53 million to $18.61 billion.
India’s reserve position with the IMF also edged lower by $11 million to $4.75 billion at the end of the reporting week, according to the RBI data.
