New Delhi. The Indian economy has taken a big leap forward achieving a major milestone. India’s foreign exchange reserves have reached an all-time high. Announcing the results of the Monetary Policy Committee (MPC) meeting, RBI Governor Shaktikanta Das said that India’s foreign exchange reserves have crossed the $ 650 billion mark for the first time, reaching a historic high of $ 651.5 billion.
Foreign exchange reserves at record high
During his address after the three-day meeting of the RBI Monetary Policy Committee, Governor Das highlighted that India’s foreign exchange reserves have increased to $651.5 billion as of the week ended May 31, 2024. This represents a significant increase from the $646.67 billion recorded in the week ended May 24, 2024, which represents an increase of $4.83 billion within just one week. Governor Das emphasized that India’s external sector remains dynamic, with key external indicators steadily improving.
What are the factors affecting foreign exchange reserves?
Fluctuations in foreign exchange reserves are primarily influenced by RBI’s intervention to manage the domestic currency. To stabilize the currency or prevent its depreciation against the dollar, the RBI can intervene in the foreign exchange market, leading to changes in the reserves.
There is no change in the policy rate
In the same address, Governor Das informed that the MPC has decided to keep the policy rate unchanged. The repo rate remains stable at 6.5%, which is the eighth consecutive MPC meeting in which the policy rate has been maintained at this level. This decision is in line with the RBI’s ongoing efforts to ensure economic stability.
