Forex Watch: Sharp Fall in FCA Drags Down India’s Forex Reserves Again, But Gold Holdings Rise

India’s foreign exchange reserves have witnessed a decline for the second consecutive week, largely due to a steep drop in Foreign Currency Assets (FCA). According to the Reserve Bank of India’s latest data, forex reserves fell by $1.87 billion in the week ending 28 November 2025. The previous week had already seen a massive dip of $4.47 billion. However, a notable rise in gold reserves helped cushion the overall fall.

Forex Reserves Slip to $686 Billion

As per RBI’s weekly bulletin, India’s total foreign exchange reserves have dropped to $686.227 billion, marking a sharp reduction caused primarily by falling FCA. In the week under review, FCA declined by $3.569 billion, following a $1.69 billion drop in the previous week.

For context, India had touched its all-time high forex reserve level of $704.885 billion during the week ending 27 September 2024.

Foreign Currency Assets form the largest component of India’s reserves and are expressed in U.S. dollars, including the impact of fluctuations in non-dollar currencies such as the euro, pound, and yen.

Gold Reserves Continue to Climb

Despite the fall in FCA, India’s gold reserves reported a significant jump.

• In the week ending 28 November 2025, gold holdings rose by $1.613 billion.
• A week earlier, the value of gold reserves had surged by $2.67 billion.

With this, India’s gold reserve valuation has now climbed to $105.795 billion, and total physical gold holdings have crossed 880 tonnes, accounting for over 14.7% of the country’s total forex reserve basket.

SDR and IMF Reserves Also Rise

The RBI report also shows a modest rise in other reserve components:

• Special Drawing Rights (SDR) increased by $63 million, taking the total to $18.628 billion.
• India’s reserve position in the IMF grew by $16 million, reaching $4.772 billion.

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