June 7th 2024.
In a recent statement, Reserve Bank Governor Shaktikanta Das announced that India's foreign exchange reserves have reached an impressive milestone, hitting an all-time high of USD 651.5 billion as of May 31. This marks an increase of USD 4.83 billion since the last reported number of USD 646.673 billion on May 24.
Das expressed his excitement about this achievement during the bimonthly policy review, stating that India has touched a new milestone in terms of its foreign exchange reserves. This is a significant feat for the country, as these reserves are considered a key indicator of its economic strength and ability to withstand any external sector disturbances. The previous record high for the reserves was USD 648.7 billion on May 17.
The governor also highlighted the resilience of India's external sector, pointing to improvements in the current account deficit, external debt to GDP ratio, and net international investment position. These factors are crucial in determining the country's vulnerability to external shocks. Das reassured that India is well-equipped to meet its external financing requirements, expressing confidence in the overall stability of the economy.
Furthermore, Das mentioned that the current account deficit for FY25 is expected to remain within a sustainable level. He attributed this to the positive contributions from remittances, services exports, and a lower trade deficit. This is a positive sign for the economy and indicates a healthy balance in trade and investment.
Overall, India's foreign exchange reserves reaching an all-time high is a testament to the country's strong economic fundamentals and its ability to navigate through external challenges. With continued improvements in key indicators, India remains well-positioned to meet its external financing needs and maintain a stable economy.
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