RBI's Gold Buying Spree Continues

The Reserve Bank of India (RBI) has significantly bolstered its gold reserves by acquiring 57.5 tonnes in FY25, marking the second-largest annual purchase in seven years. This move aligns with a global trend among central banks to increase gold holdings as a hedge against inflation and dollar volatility.

Global Trends and Economic Safeguards

Amid geopolitical tensions and fluctuations in the US Dollar, central banks worldwide are turning to gold. The RBI's gold reserves now stand at 879.6 tonnes, up from 822.1 tonnes the previous year, showcasing a strategic shift towards safer assets.

Historical Context and Future Outlook

The largest acquisition was in 2021-22 with 66 tonnes. Recent purchases reflect a cautious yet strategic approach to reserves management, with gold's appeal heightened by post-US election dollar fluctuations.

Experts highlight the diminishing appeal of US Treasuries, with central banks globally reducing reliance and increasing gold reserves. The World Gold Council notes central banks as key drivers of gold demand, influenced by economic and geopolitical factors.