India’s forex kitty shrinks by $1.27 billion as gold reserves slide; bank credit growth accelerates

NEW DELHI: India’s foreign exchange reserves fell by $1.269 billion to $719.748 billion in the week ended October 23. The decline was primarily driven by a fall in the value of gold holdings, according to the latest data released by the Reserve Bank of India (RBI) on Friday.The RBI’s weekly statistical supplement showed that the value of gold reserves dropped by $2.650 billion during the week to $103.150 billion.This came even as foreign currency assets, the biggest component of the country’s foreign exchange reserves, registered an increase of $1.358 billion to reach $593.205 billion.Other components of the forex reserves also recorded mixed movements during the week. India’s Special Drawing Rights (SDRs) increased by $27 million to $18.605 billion, while its reserve position in the International Monetary Fund (IMF) declined by $4 million to $4.787 billion.Despite the weekly contraction, the country’s foreign exchange reserves were $28.640 billion higher than the level recorded at the end of March 2026, according to the RBI figures.The RBI’s latest weekly data also showed an acceleration in bank credit growth. Outstanding bank credit rose 18.2 per cent year-on-year as of October 15, 2026, compared with a growth of 11.6 per cent in the corresponding period last year. Total outstanding bank credit stood at Rs 227.43 lakh crore.Bank deposits also registered stronger growth during the period. Aggregate deposits increased by 16.7 per cent year-on-year to Rs 278.76 lakh crore as of October 15, against a growth of 9.5 per cent recorded in the corresponding period a year earlier.Meanwhile, broad money supply (M3) grew by 16.0 per cent year-on-year as of October 15, 2026. This was higher than the 9.2 per cent growth recorded during the corresponding period last year, the RBI’s Weekly Statistical Supplement showed.