The local currency depreciated about 9.5% in FY26 even as the RBI sold a record $53.13 billion in the spot market during the year reflecting its heightened intervention in the forex market. The central bank gains when it sells dollars from the foreign exchange reserves, people aware of the matter said. It had recorded a Rs 1.11 lakh crore gain from dollar sales in FY25.
RBI’s total income from foreign sources increased by 27% to Rs 3.28 lakh crore. The income from foreign sources include a 11% higher interest income from holding of foreign securities at Rs 1.08 lakh crore against Rs 97000 crore earlier, the central bank account showed. The interest income was largely on account of the investment of forex reserves in foreign securities and deployment in global financial markets. India had a forex kitty of $691 billion at the end of March which was enough to cover 11 months of imports and 90% of the country’s external debt.
RBI’s net income from domestic sources rose 26% to Rs 1 lakh crore, mainly on account of a 38% rise in interest income on holding of rupee-denominated securities, the annual account showed. The said interest income stood at Rs 1.18 lakh crore.
The central bank had to bear a higher interest burden of Rs 19163 crore in FY26 as it sucked out the surplus liquidity from the inter-bank system through reverse repo auctions and standing deposit facility (SDF) operations. Interest expenses for its liquidity management was much lower at Rs 10120 crore in the preceding fiscal.
RBI’s balance sheet size rose 21% to Rs 91.97 lakh crore while it made provisions of Rs 1.09 lakh crore and transferred to the contingency fund. The RBI will transfer a record Rs 2.87 lakh crore of surplus to the government for FY26. RBI said that the increase on the assets side was due to rise in domestic investments, gold and foreign investments while on the liabilities side, there has been a rise in revaluation accounts, notes issued, deposits and other liabilities.