India’s Forex Reserves Rise to $687 Billion on Gold Strength

India’s Foreign Exchange Reserves Edge Higher Amid Gold Gains

India’s foreign exchange reserves posted a modest increase of $1.03 billion , reaching $687.26 billion in the week ended December 5, as per the Reserve Bank of India’s Weekly Statistical Supplement. The uptick was largely driven by a rise in gold reserves, even though foreign currency assets recorded a small decline. Overall reserves remain close to the historic peak of $704.89 billion achieved in September 2024, underlining the country’s strong external buffer.

Gold Reserves Provide Major Support

Gold holdings emerged as the key contributor to the weekly rise. During the reporting period, gold reserves increased by $1.033 billion to $106.984 billion . The increase mirrors global trends, where gold prices have firmed amid geopolitical tensions, persistent inflation risks and renewed investor demand for safe-haven assets. Central banks worldwide have been increasing gold exposure, and India’s reserve composition reflects this broader shift.

Foreign Currency Assets Dip Marginally

Foreign currency assets (FCAs), the largest component of India’s forex reserves, declined slightly by around $151 million to $556.88 billion . FCAs include holdings of major global currencies such as the US dollar, euro, pound sterling and yen. The RBI has clarified that such week-to-week variations are routine and influenced by exchange-rate movements and valuation changes.

External Sector Resilience

In its recent monetary policy assessment, the RBI reaffirmed that India’s reserve position is strong enough to cover over 11 months of imports , offering adequate protection against external shocks. The central bank also noted that the reserves provide confidence in meeting external debt obligations and managing global financial volatility.

Rupee Management and Reserve Trends

India’s forex reserves have shown steady expansion over recent years, supported by capital inflows and prudent reserve management. The RBI continues its calibrated approach—purchasing dollars during periods of rupee strength and selling them during volatility—to ensure orderly market conditions.

Exam Oriented Facts

• India’s forex reserves stood at $687.26 billion (week ended December 5, 2025).

• Gold reserves rose to $106.984 billion .

• Foreign currency assets are the largest component of reserves.

• India’s all-time high forex reserves: $704.89 billion (September 2024).