India's foreign exchange reserves declined by $9.98 billion to $655.82 billion for the week ending June 12, according to data released by the Reserve Bank of India (RBI) on June 20, 2026. The drop was primarily attributed to a significant decrease in gold reserves, which fell by $4.5 billion to $58.3 billion during the same period.
The RBI's weekly statistical supplement showed that foreign currency assets (FCAs), the largest component of forex reserves, also decreased by $5.2 billion to $572.1 billion. FCAs are expressed in dollar terms and include the effect of appreciation or depreciation of non-US currencies like the euro, pound, and yen held in the reserves.
The decline in gold reserves was partly due to a fall in international gold prices, which dropped by 3% during the week ending June 12. The RBI also reported a decrease in special drawing rights (SDRs) by $0.1 billion to $18.2 billion, while the reserve position in the International Monetary Fund (IMF) remained unchanged at $5.1 billion.
India's forex reserves had reached an all-time high of $670.1 billion in the week ending May 29, 2026, before the recent decline. The current level of $655.82 billion is still sufficient to cover approximately 11 months of imports, providing a comfortable buffer against external shocks.
Economists noted that the decline in reserves is not a cause for alarm, as it reflects routine portfolio adjustments and valuation changes rather than capital outflows. The RBI continues to intervene in the foreign exchange market to prevent excessive volatility in the rupee, which has remained stable against the US dollar in recent weeks.
