India’s forex reserves rise to US$578.78 billion

India’s foreign exchange reserves rose US$5.98 billion, reaching US$578.78 billion as on March 24, 2023, according to a data released by Reserve Bank of India.

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India’s foreign exchange reserves rose US$ 5.98 billion to US$578.78 billion on 24^th March, 2023. The data released by Reserve Bank of India (RBI) showed that India’s foreign exchange reserves has reached the highest level since early February.

As of India’s foreign currency assets (FCA), the biggest component of the forex reserves saw a rise of US$ 4.38 billion to US$ 509.72 billion. Additionally, India’s gold reserves rose by US$ 1.37 billion to US$ 45.48 billion, whereas SDRs and India’s reserve position in the IMFs saw an increase of US$ 18.41 million and US$ 5.15 million each.

At the start of 2022, the overall forex reserves were at about US$ 633 billion. The observed decline can be attributed to RBIs recent intervention and a rise in the cost of imported goods.

Indian rupee firmed against the dollar on Friday on likely fiscal year-end related inflows and strength in local equity markets. The rupee finished at 82.1650 per dollar compared to previous 82.3375.

Declining forex reserves faced with the high cost of imported goods and the ongoing monetary policy tightening by the US Federal Reserve triggered the currency’s depreciation.