This country has maximum reserve of dollar, it is not US, India, Japan, Russia, UK, name is….
As per the latest data, China holds the largest foreign exchange reserves in the world, totaling around $3.6 trillion, and a major portion of this is in US dollars. These reserves are primarily due to China's massive trade surplus. As the country exports far more than it imports, and earns a major portion of foreign currency, especially American dollars.
China uses these reserves to stabilize its own currency, the Yuan. Then invest in US Treasury bonds and cushion its economy during global financial instability. Japan: Second-Largest Reserve Holder
After China, the country in 2nd position is Japan, with reserves around $1.3 to $1.4 trillion. Japan's reserves are similarly held in major global currencies like the US dollar and are used to manage exchange rates, to maintain investor confidence and also to support trade and capital flows.
Japan's economic model, built around high exports, has helped it to gain more reserves. Switzerland At Third
Switzerland holds the third-largest foreign exchange reserves, reported to be around $795 billion to over $1 trillion, depending on currency valuation changes. The Swiss National Bank has accumulated these reserves to prevent the Swiss Franc from becoming too strong, which could harm its export-driven economy. India At Fourth Globally
India ranks fourth in the world with foreign exchange reserves between $650 billion and $675 billion, as of recent estimates. A large chunk of these reserves is in US dollars, held by the Reserve Bank of India (RBI). These reserves provide a buffer against global economic shocks, support the rupee in times of volatility and also help manage inflation and import bills.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Economic Times
14 minutes ago
- Economic Times
Union Bank shares slip 4% after Q1 profit rises 12% YoY but NII declines
Union Bank of India shares declined nearly 4% to Rs 140.80 in Monday's trade on the BSE after the state-owned lender reported a 12% year-on-year rise in net profit to Rs 4,115.5 crore for the first quarter of FY26, compared to Rs 3,679 crore in the same period last year. ADVERTISEMENT Total income rose to Rs 31,791 crore in the June quarter from Rs 30,874 crore a year ago. However, net interest income (NII) declined 3.2% year-on-year to Rs 9,112.6 crore from Rs 9,412 crore. The bank's total business grew by 5% to Rs 22.14 lakh crore, up from Rs 21.08 lakh crore at the end of June 2024. Provisions and contingencies increased to Rs 1,664.5 crore in Q1 FY26 from Rs 1,543.9 crore in the March quarter. Provisions for non-performing assets (NPAs), however, fell to Rs 1,152 crore from Rs 1,675.7 crore in Q4 month, the lender reduced its lending rates by 50 basis points, aligning with broader moderation by the Reserve Bank of India. The revision covered both the external benchmark lending rate (EBLR) and the repo-linked lending rate (RLLR), benefiting retail and MSME borrowers. ADVERTISEMENT According to Trendlyne, the average target price for Union Bank shares is Rs 152, implying a potential upside of nearly 7% from current levels. Of the 13 analysts tracking the stock, the consensus rating is 'Buy'.Technically, the stock is in a neutral trend. The Relative Strength Index (RSI) stands at 49.1, indicating balanced momentum. The MACD is at 1, above the center line but below the signal line. ADVERTISEMENT Year-to-date, Union Bank shares have gained 15%, and are up 30% over the past six months. The bank's market capitalisation currently stands at Rs 1.08 lakh crore. (Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times) (You can now subscribe to our ETMarkets WhatsApp channel)
Economic Times
14 minutes ago
- Economic Times
India bonds advance as traders build positions for another rate cut
Indian government bonds edged higher in early deals on Monday, as traders bought in the anticipation of another rate cut by the central bank as early as August. ADVERTISEMENT The yield on the benchmark 10-year bond was at 6.2965% as of 10:30 a.m. IST, compared with Friday's close at 6.3058%. Bond yields move inversely to prices. "Some foreign banks have started betting on an August rate cut, and are on the buy side, so we may see a further rally if they continue building positions," a trader at a private bank said. "Some selling pressure from mutual funds and state-run banks can offset the gains during the day." Foreign banks net bought bonds worth over 101 billion rupees ($1.17 billion) last week, while mutual funds net sold 77 billion rupees worth of bonds. State-run banks also sold in the last two sessions, data from The Clearing Corporation of India showed. ADVERTISEMENT The Reserve Bank of India's monetary policy decision is due on August 6. The central bank slashed its key interest rate by 50 basis points last month, while changing its stance to "neutral" from "accommodative". India's retail inflation rate slipped to 2.10% in June, the slowest pace in more than six years, down from 2.82% in May. ADVERTISEMENT "With the inflation trajectory likely to undershoot RBI's medium-term target of 4% through the whole of FY2026, we see room for monetary easing emerging earlier than expected," Kotak Mahindra Bank said in a note, flagging potential for up to two more rate cuts before the end of 2025. RATES ADVERTISEMENT India's overnight index swap rates saw moderate receiving pressure from rate cut wagers piling up, traders said, but short-end rates were largely unchanged in early trades. The one-year OIS rate was at 5.49% and the two-year OIS rate was flat at 5.47%. The liquid five-year dropped 1 basis point to 5.68%. (You can now subscribe to our ETMarkets WhatsApp channel)
Economic Times
16 minutes ago
- Economic Times
Hope is brightening for India's Goldilocks scenario
India's economy may be entering a Goldilocks phase with moderate growth and controlled inflation India's economy is showing signs of entering what economists often call a 'Goldilocks' phase -- neither too hot nor too cold -- marked by moderate, sustainable growth coupled with subdued inflation. The term "Goldilocks economy" is taken from the children's story 'Goldilocks and the Three Bears', in which Goldilocks tries three bowls of porridge, finding one too hot, one too cold, and one just right from which she eats it all. In economics, it describes an ideal state where the economy is neither too hot nor too cold, a steady economic growth that prevents downturn but not so much growth that inflation rises too high. The Reserve Bank of India (RBI), along with the central government, appears increasingly confident in steering the economy toward this delicate balance through calibrated monetary and fiscal actions. Recent developments, including comments from RBI Governor Sanjay Malhotra on July 15 and continued downward surprises in inflation data, suggest that India's Goldilocks scenario could be brightening. Retail inflation in June 2025 came in at just 2.1%, far below the RBI's earlier full-year projection of 3.7%. The average inflation for the April-June quarter stood at 2.7%, again undershooting the RBI's estimate of 2.9%. If current trends continue, July inflation could dip below 2%, and full-year inflation may settle close to 3%, significantly beneath the RBI's comfort band midpoint of 4%.This unexpected disinflation, largely driven by easing food prices, stable energy costs, and improving supply chains, strengthens the case for further monetary easing. RBI governor Sanjay Malhotra has said the central bank may consider cutting rates if both inflation and growth continue to soften, indicating that inflation could fall below the full-year forecast of 3.7 per cent. The monetary policy committee's neutral stance, he said, provides room to respond as conditions evolve. "If inflation and growth both trend lower, it could justify a policy rate cut," Malhotra said in an interview to CNBC TV18 yesterday. "But it depends on how the data develops. We are still in the process of updating our projections." Importantly, the Monetary Policy Committee's (MPC) neutral stance gives it the room to remain data-driven and agile in responding to evolving macroeconomic conditions. The RBI has already made two consecutive rate cuts, including a surprise 50 basis points cut in June. While market expectations had tilted toward a pause in the upcoming August policy review, the new inflation numbers may compel the MPC to economists, including Kunal Kundu of Societe Generale, believe that the RBI now has ample justification for two more 25 basis point cuts, which would bring the repo rate to 5.0%, a level that could both sustain demand and preserve financial stability. Such a stance aligns well with the RBI's updated objective: supporting growth without compromising on inflation Sen Gupta, Chief Economist, IDFC First Bank, Mumbai, said, "The moderation in inflation is led by a decline in food inflation. Core inflation remains range-bound at 4.5%. The outlook for inflation remains favourable with strong start to Kharif sowing. Meanwhile, daily prices indicate moderation in vegetables prices month-on-month in July. We continue to expect CPI inflation to average at 3% with downside risk. This is below RBI estimate of 3.7% in FY26. There is space for one more 25bps cut in October or December." Garima Kapoor, Economist, Institutional Equities, Elara Securities, Mumbai, said, "We expect full year CPI inflation to remain below the RBI's full-year estimate of 3.7%, and hence do not rule out the possibility of another rate cut post the end of monsoon."Radhika Rao, Senior Economist, DBS Bank, Singapore, said, "June inflation rose by the slowest pace in six years, in line with our forecast at 2.1% year over year vs 2.8% the month before. Despite the sequential rise in perishables, especially vegetables, the broad food basket remained on a disinflationary path led by cereals and pulses, keeping headline inflation in check. The weak June inflation reading will feed into expectations that the RBI MPC could warm up to further cuts in this cycle." India's GDP growth remained steady at 6.5% in FY2024-25, and the RBI projects a similar trajectory for the current fiscal year. This resilience is noteworthy, especially when set against a backdrop of global uncertainty, including lingering trade tensions, geopolitical volatility and subdued external demand. The June RBI bulletin acknowledged these risks, citing the precarious global environment, ongoing supply-side fragilities, and the risk of fresh geopolitical shocks. Yet, India's macro fundamentals -- strong domestic demand, moderate fiscal deficit and a relatively stable external position -- provide a firm cushion. The Ministry of Finance, in its May economic review, while cautioning about external vulnerabilities, struck a tone of cautious optimism: 'These could be nervous but exciting times for the Indian economy.'One key opportunity on the horizon is the potential India-US trade agreement, which could become a significant tailwind for Indian exports. In an environment where global trade has been marred by uncertainty and protectionism, a bilateral deal with the world's largest economy could unlock market access, investment flows, and technology positive domestic signals, Indian policymakers remain appropriately cautious. The RBI's emphasis on flexibility and data-dependence is crucial, given that global conditions remain volatile. Any sudden surge in oil prices, a flare-up in geopolitical tensions, or reversal of global capital flows could derail progress. The reference by the finance ministry to the need to "ride the tide" signals the importance of nimble policymaking, not just in monetary terms but also via targeted fiscal interventions, trade strategy and regulatory reforms. India's continued emphasis on supply-side improvements, from logistics and energy to skilling and MSME support, will be vital to strengthening the Goldilocks stars seem to be aligning for India. Falling inflation, stable growth, a proactive central bank, and possible India-US trade deal as well as other trade agreements, all suggest that the country is moving closer to an optimal policy equilibrium. The key now lies in execution, ensuring external risks are managed deftly and reform momentum is not lost. If India plays its cards right, this Goldilocks phase could serve as a launchpad for a sustained, inclusive and stable economic expansion, positioning it as one of the few large economies able to navigate an increasingly turbulent global landscape with confidence and poise. (With agency inputs)
