RBI parks majority of its gold reserves in India; Local holdings up 100 tonnes in H1

Domestic holdings of gold by the Reserve Bank of India (RBI) rose by more than 100 metric tonnes in the half-year ended September, while the share of gold in the total foreign exchange reserves also climbed, as the central bank stepped up purchases of the precious metal.

“As at end-September 2024, the Reserve Bank held 854.73 metric tonnes of gold, of which 510.46 metric tonnes were held domestically. While 324.01 metric tonnes of gold were kept in safe custody with the Bank of England and the Bank for International Settlements (BIS), 20.26 metric tonnes were held in the form of gold deposits,” the central bank said in its half-yearly report on management of foreign exchange reserves for April-September 2024.

At the end of March 2024, the RBI held 822.10 metric tonnes of gold, of which 408.31 metric tonnes were held within the country.

In value terms based on US dollars, the share of gold in the total foreign exchange reserves rose to 9.32% as of September 30 from 8.15% at the end of March.

At the end of March 2024, 387.26 metric tonnes of gold were kept with the Bank of England and the BIS while 26.53 metric tonnes were held in the form of gold deposits, according to the RBI’s half-yearly report for October-March.In June, RBI governor Shaktikanta Das had said that while the quantum of gold held by the central bank outside the country was static for a long time, in recent years data had shown that the monetary authority had been buying gold as a part of its reserve management and the quantum held outside was going up.”We have domestic capacity now, and we felt part of the gold should be stored within the country. That is it. Nothing more should be read into it,” Das had said at the RBI’s June monetary policy press conference.

The RBI’s foreign exchange reserves increased to $705.78 billion as of September 30 from $646.42 billion as of March 31, the central bank said in its latest half-yearly report.

The RBI’s foreign currency assets, which are maintained in major global currencies, are expressed in US dollar terms. Movements in the foreign currency assets occur primarily due to the purchase and sale of foreign exchange by the RBI, income arising out of the deployment of the foreign exchange reserves, external aid receipts of the central government and changes on account of revaluation of the assets, the central bank said.

Out of the RBI’s total foreign currency assets worth $617.07 billion as of September, $515.30 billion, or 83.51% was invested in securities, $60.11 billion was deposited with other central banks and the BIS and the remaining $41.66 billion was made up of deposits with commercial banks overseas.

As of March 31, the RBI’s total foreign currency assets were $570.95 billion, of which $468.99 billion, or 82.14%, was invested in securities.