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India forex reserves hit record $729.33 billion in August
The Indian Express··29 Aug
India's foreign exchange reserves rose to a record $729.33 billion as on August 21, the RBI said Friday. Reserves jumped $12.42 billion in the week, driven by $65.4 billion in FCNR(B) deposits since June under the RBI's concessional swap window. The previous record was $728.49 billion on February 27, a day before the US and Israel attacked Iran.
Prism
What It Means For You
- Foreign investors will watch whether FCNR inflows continue after the swap window closes on August 31.
- The RBI absorbed dollar inflows through discounted FX swaps rather than allowing sharp rupee appreciation.
- Higher reserves signal capacity to finance essential imports during oil-price shocks.
What's Happening
- Since March-end 2026, India's reserves have risen by $38.221 billion.
- At end of May, total FCNR(B) deposits outstanding were $34.04 billion before the window opened.
- Foreign funds pulled $19 billion from Indian stocks in 2025 and $24 billion in the first five months of 2026.
What FCNR Deposits Mean For Reserves
- The FCNR(B) window has been operational since June 8 with banks offering rates as high as 7.4 percent.
- Almost 85 percent of India's crude oil needs are met through imports.
- The previous record stood just a day before the West Asia conflict pushed up global energy prices.
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