India’s Forex Reserves Slip by USD 8 Billion to USD 688.894 Billion Amid Market Pressure

India’s foreign exchange reserves fell sharply by USD 8.094 billion to USD 688.894 billion in the week ended May 15, according to data released by the Reserve Bank of India.

The decline comes after a brief recovery in the previous week, when reserves had risen by USD 6.295 billion to USD 696.988 billion. The overall movement highlights continued volatility in India’s external financial position amid global and domestic pressures.

Earlier this year, the reserves had touched an all time high of USD 728.494 billion in the week ended February 27. However, the situation changed in the following weeks as geopolitical tensions in the Middle East triggered pressure on global markets and the rupee. During this period, the central bank also stepped in through dollar sales to stabilise currency fluctuations.

According to the Reserve Bank of India, the latest fall was led primarily by a decline in foreign currency assets , which dropped by USD 6.483 billion to USD 545.904 billion . These assets include major global currencies such as the euro, pound, and yen, whose valuation shifts impact overall reserves.

Gold reserves also recorded a fall, decreasing by USD 1.536 billion to USD 119.317 billion during the week. In addition, Special Drawing Rights (SDRs) declined by USD 49 million to USD 18.824 billion, while India’s reserve position with the International Monetary Fund slipped by USD 25 million to USD 4.85 billion.

The report comes against the backdrop of heightened economic attention on external balance management . Prime Minister Narendra Modi had recently urged citizens to reduce non essential foreign travel, limit fuel consumption, and avoid gold purchases for a year as part of broader efforts to conserve foreign exchange.

Overall, the latest data reflects continued pressure on India’s forex buffer after record highs earlier this year, with movements driven by global conflict, currency volatility, and central bank intervention aimed at maintaining stability in the foreign exchange market.