India’s forex reserve hit an all-time high of $645.58 billion

Increasing Forex reserves: India's foreign exchange reserves have soared to an all-time high of $645.58 billion as of March 29, marking the sixth consecutive week of growth. This week alone, reserves spiked by $2.95 billion, adding to the remarkable $26.5 billion accumulated over the preceding five weeks. 

Driving this increase are not only RBI interventions but also the fluctuating values of foreign assets, including India's reserve tranche position in the International Monetary Fund. Despite India's robust economic expansion and substantial inflows into its financial markets, the RBI's focus has been on bolstering reserves as a precautionary measure against potential economic downturns or adverse market conditions.

Speaking on this trajectory, RBI Governor Shaktikanta Das underscored the importance of fortifying the nation's forex reserves as a form of financial insurance, likening it to building a sturdy umbrella to weather storms. This strategic accumulation aims to provide a resilient buffer against future uncertainties.

Amidst currency market turbulence, the Indian rupee faced pressures, hitting a historic low of 83.45 against the US dollar during the week in review. However, by week's end, the rupee managed to claw back some ground, settling at 83.2950 on Friday, reflecting a modest 0.1 per cent weekly gain.

With Reuter's Inputs