India’s forex reserves slip to $717 billion; gold takes the hit as RBI data flags a sharp drop

According to data, the forex kitty has increased by about 56 billion in 2025.

• India's forex reserves fell $6.71 billion to $717.06 billion
• Gold reserves fell $14.21B, FCA increased $7.66B
• Reserves still cover over 11 months of merchandise imports

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India's foreign exchange reserves dipped USD 6.711 billion in the week that ended February 6 to $717.064 billion, after having reached a new all-time high in the prior week, according to the Reserve Bank of India's latest data.

Foreign exchange reserves dipped substantially in the latest week, driven by a drop in gold reserves while foreign currency assets rose.

Over the past few weeks, the forex kitty has been largely in an uptrend. Foreign exchange reserves touch record high of USD 723.774 billion last week.

For the reported week (that ended February 6), India's foreign currency assets (FCA), the largest component of foreign exchange reserves, stood at $570.053 billion, up $7.661 billion.

The RBI data showed that gold reserves currently stood at $123.476 billion, down $14.208 billion from the previous week.

After the latest monetary policy review meeting earlier this month, the RBI had said that the country's foreign exchange reserves were sufficient to cover more than 11 months of merchandise imports. RBI said India's external sector remains resilient, and it was confident of comfortably meeting the country's external financing requirements.

According to data, the forex kitty has increased by about 56 billion in 2025.

In 2024, reserves rose by just over $20 billion.

In 2023, India added around $58 billion to its foreign exchange reserves, in contrast to a cumulative decline of $71 billion in 2022.

Foreign exchange reserves, or forex reserves, are assets held by a nation's central bank or monetary authority, primarily in reserve currencies such as the US dollar, with smaller portions in the Euro, Japanese yen, and Pound Sterling.

The RBI often intervenes by managing liquidity, including selling dollars, to prevent a steep depreciation of the rupee. The RBI strategically buys dollars when the Rupee is strong and ideally sells when it weakens.