Foreign Exchange Reserves Of India: With its growing economic strength, India has achieved another milestone in the list of countries with the highest foreign exchange reserves in the world. India has come fourth in the list of countries with the highest foreign exchange reserves after China, Japan, and Switzerland. There was a time when India's economy was considered a part of the 'weak five' economies. But India has overcome that situation and has traveled a journey to become the fastest-growing major economy, which is an example for other developing countries.

What is the foreign exchange reserve?

Today India has not only become the fifth largest economy in the world, but has also created a new record in terms of foreign exchange reserves. For the first time in history, India's foreign exchange reserves have exceeded 700 billion dollars.

India's foreign exchange reserves rose by $12.588 billion in a week to an all-time high of $704.885 billion in the week ended September 27, according to the Reserve Bank of India.

Last month's decline

However, last month, foreign exchange reserves have come down from an all-time high. This decline is likely due to RBI's intervention to prevent a sharp fall in the rupee. A high buffer of foreign exchange reserves helps protect domestic economic activity from global shocks.

According to estimates, India's foreign exchange reserves are now sufficient to cover a year or more of projected imports. Foreign exchange reserves Foreign exchange reserves are assets held by a country's central bank or monetary authority.

What is India's foreign exchange reserve now?

According to the latest RBI data, India's foreign exchange reserves fell by $3.463 billion to $684.805 billion in the week ended October 25. In the previous week, it had fallen by $2.163 billion to $688.267 billion. India is also in the fourth position in terms of reserves. At the end of September, the reserves had reached an all-time high of $704.885 billion.

In which currency are the foreign exchange reserves held

Foreign exchange reserves are usually held in reserve currencies, the US dollar and to a lesser extent the euro, Japanese yen, and pound sterling. The RBI closely monitors the foreign exchange markets. The RBI often intervenes in the market through liquidity management, including the sale of dollars, to prevent a sharp fall in the value of the rupee.