Mumbai, May 2 (IANS) India’s foreign exchange reserves rose for the eighth straight week to touch $688.13 billion as of April 25, according to the latest RBI data released on Friday.
The foreign exchange kitty surged by $1.98 billion during the week.
The foreign currency component of the reserves increased by $2.17 billion to $580.66 billion.
The gold reserves component of the forex reserves decreased by $207 million to $84.37 billion while Special Drawing Rights (SDR) went up by $21 million to $18.59 billion.
The declining trend in forex reserves of earlier months due to revaluation and forex market interventions by the RBI to help reduce volatility in the rupee has now been reversed over the last two months .
Earlier, the country’s forex reserves had increased to an all-time high of $704.885 billion in September 2024.
Any strengthening of the country’s foreign exchange kitty also helps bolster the rupee vis-a-vis the US dollar which is good for the economy.
An increase in the foreign exchange reserves reflects the strong fundamentals of the economy and gives the RBI more headroom to stabilise the rupee when it turns volatile.
A strong forex kitty enables the RBI to intervene in the spot and forward currency markets by releasing more dollars to prevent the rupee from going into a free fall.
Conversely, a declining forex kitty leaves the RBI less space to intervene in the market to prop up the rupee.
Meanwhile, India’s external sector has emerged stronger with total exports rising to an all-time high of $824.9 billion in the financial year 2024–25 despite geopolitical uncertainties and a slowdown in world trade.
This represents a growth of 6.01 per cent over the previous year’s export figure of $778.1 billion.
Services exports continued to drive the growth momentum, reaching a historic high of $387.5 billion in 2024–25, up 13.6 per cent from $341.1 billion in the previous year. For March 2025, services exports stood at $35.6 billion, reflecting a year-on-year growth of 18.6 per cent compared to $30.0 billion in March 2024, the latest RBI figures show.
In 2024–25, merchandise exports excluding petroleum products rose to a record $374.1 billion, registering a 6 per cent increase from $352.9 billion in 2023–24 — the highest ever annual non-petroleum merchandise exports.
–IANS
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