India's foreign exchange reserves at a record high of $648.56 bn
foreign exchange reserves touched a fresh record high of $648.56 billion in the week ended April 5th, topping the previous high of $645.58 billion, latest data published by the central bank showed.
The reserves rose by $2.9 billion and were primarily driven by gold assets that climbed $2.4 billion. A spike in bullion (gold) prices has caused reserves to surge. This is the third time in the past two months where reserves have touched fresh highs.
Potential supply chain disruptions spawned by uncertain geopolitics in West Asia and Eastern Europe prompted central banks to increase their gold assets, helping mitigate the impacts of currency volatility and elevated interest rates in the US.
“Most of the central banks have been buying gold over the past couple of years, especially during the outbreak of COVID and then the Russia-Ukraine war and that’s the same theme which the Governor and the Deputy Governor reiterated during the monetary policy conference,”said Anubhuti Sahay, head of South Asia Economic Research, Standard Chartered Bank.
The Reserve Bank of India (RBI) Governor, Shaktikanta Das, mentioned in the post policy meeting that the Central Bank has been building up its gold reserves.
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