Record Inflow of Rs 3,751 Crore into Gold ETFs in India this January Amid Global Tensions and US Tariffs
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Synopsis
In January, gold ETFs in India saw an unprecedented inflow of Rs 3,751.4 crore, the highest ever in a month. This increase was driven by rising gold prices, market volatility, and geopolitical tensions, making gold a popular safe-haven asset.
Key Takeaways
- Gold ETFs experienced record inflows of Rs 3,751.4 crore in January.
- Yearly inflows surged 471 percent compared to January 2024.
- Average returns for gold ETFs in January were 7.29 percent.
- Investors are turning to gold amid global uncertainties.
- Lower interest rates are driving demand for gold.
Mumbai, Feb 12 (NationPress) Gold exchange-traded funds (ETFs) experienced an extraordinary influx of investments in January, with a remarkable Rs 3,751.4 crore being funneled into these funds, as reported by the Association of Mutual Funds in India (AMFI) on Wednesday.
The January inflows represent the highest monthly total ever recorded for gold ETFs, surpassing the Rs 640 crore invested in December 2024.
Over the past year, gold ETFs have demonstrated impressive growth, with a staggering 471 percent increase in inflows year-on-year, climbing from Rs 657 crore in January 2024 to Rs 3,751.4 crore in January 2025.
These funds also provided attractive returns, with an average gain of approximately 7.29 percent in January.
The growth in investments was influenced by various factors, including rising gold prices and increasing market volatility due to US President Donald Trump’s tariff threats. In light of global uncertainties and geopolitical tensions, many investors turned to gold as a safe-haven asset.
Furthermore, the anticipation of interest rate reductions by major central banks, particularly the US Federal Reserve, has made gold an even more appealing option.
Lower interest rates diminish the opportunity cost of holding gold, consequently enhancing its demand.
Investors are increasingly utilizing gold ETFs to hedge against inflation and diversify their investment portfolios. As inflationary pressures persist globally, gold remains a favored asset for those in search of stability.
Gold prices have experienced fluctuations after reaching an all-time high earlier this week.
However, prices dipped on Wednesday following hawkish remarks from US Federal Reserve Chair Jerome Powell, who indicated a more gradual approach to rate cuts.
On the Multi Commodity Exchange (MCX), gold futures for April delivery fell by Rs 345 to Rs 85,178 per 10 grams.
In the global market, gold futures decreased by 0.18 percent to $2,892.76 per ounce.
On February 10, gold prices surged to new record highs in the domestic futures market as uncertainty surrounding US President Donald Trump’s tariff policies heightened demand for the precious metal.
On that date, the price of 24-carat gold reached Rs 8,537 per gram, while 22-carat gold was priced at Rs 8,332 per gram, as reported by the India Bullion and Jewellers Association (IBJA).
