India’s foreign exchange reserves declined by $3.049 billion to $699.736 billion for the week ended July 4, according to data released by the Reserve Bank of India (RBI) on Friday.This comes after a sharp rise of $4.849 billion in the previous week, which had taken the reserves to $702.784 billion. The all-time high of $704.885 billion was recorded in end-September 2024, PTI reported.The latest fall was led by a $3.537 billion drop in foreign currency assets, the largest component of the reserves, which stood at $591.287 billion for the week. These assets are expressed in dollar terms and reflect the change in value of non-US currencies like the euro, pound and yen.However, gold reserves rose by $342 million to $84.846 billion, while Special Drawing Rights (SDRs) increased by $39 million to $18.868 billion.India’s reserve position with the International Monetary Fund (IMF) also improved, rising by $107 million to $4.735 billion during the reporting week. Foreign exchange reserves are regarded as a crucial safeguard against external vulnerabilities such as volatile oil prices, currency fluctuations, and global financial uncertainty. They act as a key indicator of a nation’s capacity to meet import requirements and to intervene in currency markets when necessary.The Reserve Bank of India actively oversees the management of these reserves to uphold financial stability and sustain confidence in the external sector. The RBI’s weekly statistical supplement, released every Friday, provides a regular snapshot of India’s forex position and its overall resilience to external shocks.