India’s forex reserves rebound past $690 billion amid accelerated inflows

India’s foreign exchange reserves surged to $692.866 billion in the week ending July 31, driven by a significant rise in foreign currency assets and gold holdings, signalling a robust recovery from earlier volatility and increased foreign inflows.

India’s foreign exchange reserves rose sharply to $692.866 billion in the week ended July 31, the Reserve Bank of India said on Friday, extending the rebound seen in recent weeks as the country’s external buffers recovered from earlier volatility. The increase of $10.512 billion followed a $6.118 billion gain in the previous week and took reserves further away from the lows seen during the period of pressure on the rupee earlier this year.

The latest increase was led by a $8.75 billion rise in foreign currency assets, which climbed to $564.68 billion, according to central bank data. These assets are valued in dollar terms and reflect movements in non-U.S. currencies such as the euro, pound and yen. Gold holdings also increased, rising by $1.685 billion to $104.743 billion, while Special Drawing Rights were up by $48 million at $18.666 billion. India’s reserve position with the International Monetary Fund edged higher by $28 million to $4.778 billion.

The latest figures come after a volatile first half of the year. The reserves had touched a record $728.494 billion in the week ended February 27 before easing in the wake of the West Asia conflict, as the rupee came under strain and the RBI intervened with dollar sales. More recently, the central bank and government introduced measures to attract foreign exchange inflows, including steps linked to foreign currency non-resident bank deposits, and reports suggest the country has received about $32 billion under those schemes. Earlier in July, reserves were at $674.19 billion on July 3 and $676.237 billion on July 17, underscoring the steady recovery before the latest jump.