India's foreign exchange reserves plummeted by a record $18.3 billion in a single week. The sharp decline comes as the central bank aggressively sells dollars to defend the rupee from depreciating against a surging US dollar.
$18.3 billion
Weekly Forex Drop
Prior Week Drop: $14.88 billion→$18.3 billion
⏳ Time Machine
How today’s news fits into the bigger picture
2013
Taper Tantrum hits rupee
The US Federal Reserve suggests winding down bond purchases, causing massive capital flight from India and depleting its small forex reserves.
2022
Ukraine war spikes crude
Crude oil crosses $110 per barrel, forcing the Reserve Bank of India to spend over $50 billion defending the rupee.
September 2026
Reserves hit historic peaks
India's forex stockpile reaches record highs before geopolitical escalation in West Asia triggers sudden .
Today
India's foreign exchange reserves post an unprecedented weekly decline of $18.3 billion.
What happens next?
The central bank may allow gradual depreciation of the rupee if external shocks persist through the quarter.
India’s foreign exchange reserves registered their largest-ever weekly drop, falling by $18.3 billion. This marked the third consecutive week of declines, wiping out a total of $38.2 billion from the country's cash reserves. The sharp contraction is primarily driven by the Reserve Bank of India's active currency market interventions. As geopolitical tensions in West Asia escalate and global crude oil prices rise, foreign portfolio investors have been rapidly pulling money out of emerging markets like India. To prevent a free-fall of the rupee, the central bank has been selling its dollar reserves to supply liquidity. While India's total forex safety cushion remains substantial, the unprecedented pace of this weekly drop signals intensifying pressure on the domestic currency from global macroeconomic shocks.
💭 If you're wondering…
When there is panic, investors sell rupees to buy dollars, which weakens the rupee. By selling dollars from its reserves, the RBI increases the supply of dollars in the market, balancing the demand and preventing the rupee from crashing.
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Official sources
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