**Executive Summary**
The Reserve Bank of India has released data on the sources of variation in foreign exchange reserves for April-December 2025. This data, based on the balance of payments for Q3 of 2025-26, indicates an increase in foreign exchange reserves in nominal terms by US$ 19.4 billion, a significant shift from a depletion of US$ 10.7 billion in the same period of 2024. The release was made on February 5, 2026.
**Key Points / Main Content**
* **Foreign Exchange Reserves Variation (April-December 2025 vs. 2024)**
* **Nominal Terms (Including Valuation Effects):** Reserves increased by US$ 19.4 billion in April-December 2025, compared to a decrease of US$ 10.7 billion in April-December 2024.
* **BoP Basis (Excluding Valuation Effects):** Reserves decreased by US$ 30.8 billion in April-December 2025, a larger depletion than the US$ 13.8 billion in April-December 2024.
* **Sources of Variation**
* **Current Account Balance:** Showed a deficit of US$ 30.2 billion in April-December 2025, an improvement from a deficit of US$ 36.7 billion in April-December 2024.
* **Capital Account (Net):** Experienced a net outflow of US$ 0.6 billion in April-December 2025, a reversal from a net inflow of US$ 22.9 billion in April-December 2024.
* Foreign Investment (net) turned negative at -US$ 1.3 billion from a positive US$ 10.0 billion.
* Banking Capital saw an inflow of US$ 1.0 billion, an increase from US$ -0.8 billion.
* NRI Deposits decreased to US$ 11.1 billion from US$ 13.3 billion.
* Short-term Credit increased to US$ 15.3 billion from US$ 11.6 billion.
* External Assistance decreased to US$ 1.0 billion from US$ 4.2 billion.
* External Commercial Borrowings decreased to US$ 6.7 billion from US$ 7.9 billion.
* Other Items in Capital Account showed a significant net outflow of US$ 23.4 billion, an increase from US$ -10.0 billion.
* **Valuation Change:** Recorded a substantial gain of US$ 50.2 billion in April-December 2025, a significant increase from US$ 3.1 billion in April-December 2024. This gain is attributed to higher gold prices, US dollar depreciation, and lower bond yields.
**Impact Analysis**
**Reserve Bank of India**
* **Impact:** The Reserve Bank of India is responsible for collecting, analyzing, and releasing this data. The data reveals a notable shift in the foreign exchange reserves, with an increase in nominal terms driven by valuation gains, despite a decrease on a BoP basis.
* **Action Required:** The Reserve Bank of India has published the data on its website and released it via a press release.
**Public and Financial Institutions**
* **Impact:** Stakeholders relying on balance of payments data and foreign exchange reserve trends will use this information for economic analysis, investment decisions, and policy formulation. The significant valuation gain highlights the impact of external market factors on reserve levels.
* **Action Required:** Review the released data to understand the drivers of changes in foreign exchange reserves during the specified period.
**Businesses and Investors**
* **Impact:** Businesses engaged in international trade and investment, as well as investors, will be affected by the insights into foreign exchange dynamics, currency movements, and capital flows. The changes in the capital account and valuation effects can influence foreign exchange risk management and investment strategies.
* **Action Required:** Assess the implications of these reserve variations and their underlying causes on their financial operations and investment outlooks.
Key Entities Referenced
Reserve Bank of India: The central bank responsible for releasing the balance of payments data and this press release.
balance of payments (BoP) data: The core data set analyzed in the document, used to explain variations in foreign exchange reserves.
foreign exchange reserves: The primary subject of the document, whose sources of variation are being detailed.
BPM6: The Balance of Payments and International Investment Position Manual, 6th Edition, a referenced standard for BoP reporting.
प्रेस प्रकाशनी PRESS RELEASE
भारतीय �रज़वर् बैंक
RESERVE BANK OF INDIA
वेबसाइट : www.rbi.org.in/hindi संचार िवभाग, केंद्रीय कायार्लय, शहीद भगत िसंह मागर्, फोटर्, मुंबई - 400 001
Website : www.rbi.org.in Department of Communication, Central Office, Shahid Bhagat Singh Marg, Fort,
ई-मेल/email : helpdoc@rbi.org.in Mumbai - 400 001 फोन/Phone: 022 - 2266 0502
February 5, 2026
Sources of Variation in India’s Foreign Exchange Reserves
during April-December 2025
Today, the Reserve Bank of India released the balance of payments (BoP) data
for the third quarter (Q3), i.e., October-December of 2025-26, on its website
(www.rbi.org.in). On the basis of these data, the sources of variation in foreign
exchange reserves during April-December 2025 are detailed below in Table 1.
Table 1: Sources of Variation in Foreign Exchange Reserves*
(US$ billion)
April-December April-December
Items
2024 2025
I. Current Account Balance -36.7 -30.2
II. Capital Account (net) (a to f) 22.9 -0.6
a. Foreign Investment (i+ii) 10.0 -1.3
(i) Foreign Direct Investment (FDI) 0.6 3.0
(ii) Portfolio Investment 9.4 -4.3
b. Banking Capital -0.8 1.0
of which: NRI Deposits 13.3 11.1
c. Short-term Credit 11.6 15.3
d. External Assistance 4.2 1.0
e. External Commercial Borrowings 7.9 6.7
f. Other Items in Capital Account -10.0 -23.4
III. Valuation Change 3.1 50.2
IV. Total (I+II+III) @
Increase in reserves (+) / Decrease in -10.7 19.4
reserves (-)
*: Based on the old format of BoP which may differ from the new format (BPM6) in
the treatment of transfers under the current account and ADRs/ GDRs under
portfolio investment.
@: Difference, if any, is due to rounding off.
Note: ‘Other Items in Capital Account’ apart from ‘Errors and Omissions’ includes SDR
allocation, leads and lags in exports/imports, funds held abroad, advances
received pending issue of shares under FDI, capital receipts not included
elsewhere, and rupee denominated debt.2
On a balance of payments basis (i.e., excluding valuation effects), foreign
exchange reserves decreased by US$ 30.8 billion during April-December 2025 as
compared to a depletion of US$ 13.8 billion during April-December 2024. Foreign
exchange reserves in nominal terms (i.e., including valuation effects) increased by
US$ 19.4 billion during April-December 2025 as against a depletion of US$ 10.7
billion in April-December 2024 (Table 2).
Table 2: Comparative Position of Variation in Reserves
(US$ billion)
April-December April-December
Item s 2024 2025
Change in Foreign Exchange Reserves
1. -10.7 19.4
(i.e., Including Valuation Effects)
Valuation Effects
2. 3.1 50.2
[Gain (+)/Loss (-)]
Change in Foreign Exchange Reserves
3. on BoP basis (i.e., Excluding Valuation -13.8 -30.8
Effects)
Note: Increase in reserves (+)/Decrease in reserves (-).
Difference, if any, is due to rounding off.
The valuation gain, primarily reflecting higher price of gold, depreciation of US
dollar against major currencies and lower bond yields, increased to US$ 50.2 billion
during April-December 2025 from US$ 3.1 billion during April-December 2024.
(Brij Raj)
Press Release: 2025-2026/2202 Chief General Manager