India's foreign exchange reserves rose to $716.9 billion in the week ended August 14, the highest level in roughly six months, the Reserve Bank of India reported on Friday.
Reserves increased by nearly $10 billion from the prior week, marking the seventh consecutive week of growth and bringing the cumulative gain over that period to about $50 billion. Foreign currency assets contributed $7.2 billion to the rise, while gold reserves added $2.7 billion, according to the central bank's weekly data.
The current level approaches the historic peak of $728.5 billion recorded in February. The increase follows policy measures announced in June aimed at attracting dollar inflows to bolster India's balance of payments. These included discounted hedge facilities for external borrowings by state-owned enterprises and banks, as well as a free hedge facility for banks raising foreign currency deposits abroad. The central bank has absorbed these flows through discounted currency swaps.
As of August 13, the central bank reported receiving nearly $57 billion in inflows under these measures, with over $50 billion originating from foreign currency deposits. The surge in deposits prompted the central bank to advance the closure of its deposit hedge facility by one month, setting the new termination date for August 31.
