India’s Forex Reserves Fall by $6.71 Billion as Gold Holdings Decline Sharply Despite Rise in FCA

Mumbai, February 14:
India’s foreign exchange reserves recorded a significant decline during the week ended February 6, 2026, primarily due to a steep fall in the value of the country’s gold reserves, according to data released by the Reserve Bank of India (RBI) on Friday.

The RBI reported that India’s total forex reserves dropped by $6.711 billion, bringing the overall reserves down to $717.064 billion. This fall comes after a sharp rise of $14.361 billion in the previous week.

India’s forex reserves had earlier touched a record high of $723.774 billion in the week ended January 30, 2026.

Gold Reserves Witness Major Decline

The sharp reduction in forex reserves was largely driven by a steep fall in the valuation of India’s gold holdings. During the review period, the value of gold reserves fell by $14.208 billion, largely due to a drop in international gold prices.

In the previous week, gold reserves had increased by $14.595 billion, highlighting the volatility linked to global price movements.

Following the latest fall, India’s gold reserves are now valued at $123.476 billion.

The RBI also noted that India’s physical gold stock has crossed 880 tonnes, with gold now accounting for nearly 15% of the country’s total forex reserves.

Foreign Currency Assets (FCA) Rise

Despite the overall decline in forex reserves, India’s Foreign Currency Assets (FCA) — the largest component of total reserves — showed strong growth.

During the week ended February 6, FCA increased by $7.661 billion, rising to $570.053 billion. In the previous week, FCA had declined by $493 million.

FCA holdings include assets held in foreign currencies such as the Euro, Pound Sterling, and Japanese Yen, and their value is influenced by currency fluctuations against the US Dollar.

SDR and IMF Reserve Position Dip Slightly

The RBI data also indicated a marginal decline in India’s Special Drawing Rights (SDR). SDR fell by $132 million, reaching $18.821 billion. A week earlier, SDR had increased by $216 million.

India’s reserve position with the International Monetary Fund (IMF) also declined slightly by $32 million, falling to $4.715 billion.

Conclusion

The latest figures underline how fluctuations in global commodity prices, particularly gold, can significantly impact the overall valuation of India’s foreign exchange reserves. While the rise in FCA reflects strength in foreign currency holdings, the sharp fall in gold valuation outweighed these gains, resulting in an overall drop in reserves.

With global markets remaining volatile, forex reserves may continue to witness short-term fluctuations driven by currency movements, gold prices, and international economic trends.