India’s Forex Reserves Hit Record High of $785.7 Billion

India’s foreign exchange reserves have climbed to a record high of $785.706 billion for the week ended September 4, according to the Reserve Bank of India’s latest weekly data. The reserves increased by $44.903 billion compared with the previous week, when they had risen by $11.475 billion. The latest surge marks a significant strengthening of the country’s external financial buffers. Foreign currency assets, the largest component of the reserves, increased by $47.498 billion to $648.168 billion during the week.

The rise in reserves comes against the backdrop of pressure on the Indian rupee and elevated dollar demand. The RBI has been intervening in the foreign exchange market to manage excessive volatility in the domestic currency. Reserves had declined after geopolitical tensions escalated in West Asia, but have since recovered strongly. The latest record provides greater flexibility for the RBI to manage external-sector pressures and maintain stability in the foreign exchange market.