RBI adds 25 tons of gold to its reserves in the second half of the FY25

The Indian Reserve Bank (RBI) increased its golden reserves by 25 tons in the second half of the fiscal year 2025, according to official data issued on Monday. This addition comes during a period of great price escalation in gold, which witnessed a 30 % increase. By the end of March 2025, the total gold bias in RBI was 879.59 tons, an increase of 854.73 tons at the end of September 2024. This increase is part of the largest annual gold acquisition over the past seven years, with the addition of more than 57 tons throughout the fiscal year 25.

The percentage of gold in the total foreign drainage reserves in RBI increased to 11.70 % at the end of March, compared to 9.32 % six months ago. However, the total foreign exchange reserves decreased to 668.33 billion dollars from 705.78 billion dollars in September 2024. This reduction affects the capacity of importing reserves, which can now support 10.5 months of imports for the previous 11.8 months.

A large part of the RBI gold reserves are locally stored, with the quantities increasing slightly to 511.99 tons. In addition, 348.62 tons are secured with the Bank of England and the bank for international settlements, while 18.98 tons are preserved as gold deposits. The transformation of gold to local storage in the fiscal year is one of the most important gold movements in India since 1991, motivated by the growing global geopolitical tensions.

In the context, the RBI strategy appears to be in line with global trends as central banks choose to enhance gold reserves as hedging against currency fluctuations and geopolitical risks. Despite the decrease in the total reserves, the increase in gold holdings may provide stable originally amid the volatile market conditions. This approach by RBI reflects a cautious reinforcement of financial stability, and a balance between the accumulation of gold with the fall of the falling Forex reserve scenario.