RBI Acquires Additional 8 Tonnes of Gold in November as a Safe-Haven Investment
Click to start listening
Mumbai, Jan 7 (NationPress) The Reserve Bank of India (RBI) has procured another eight tonnes of gold in November 2024, as central banks worldwide maintained their buying momentum, collectively purchasing 53 tonnes of the precious metal during the month, according to the latest report from the World Gold Council (WGC).
The drop in gold prices in November, following the US election, likely encouraged some central banks to enhance their gold holdings, the report noted.
Similar to other central banks, the RBI has been acquiring gold as a safe-haven asset. This strategy is primarily focused on hedging against inflation and minimizing foreign currency risks, particularly during uncertain times caused by geopolitical tensions.
By adding eight tonnes of gold to its reserves in November, the RBI's total purchases have reached 73 tonnes in the first eleven months of 2024, raising its overall gold holdings to 876 tonnes and securing its position as the second-largest buyer of the year after Poland.
The People's Bank of China (PBoC) has resumed its gold purchases after a six-month hiatus, acquiring five tonnes and bringing its year-to-date net purchases to 34 tonnes, with total reported gold holdings amounting to 2,264 tonnes (about 5 percent of total reserves), as stated in the report.
In contrast, the Monetary Authority of Singapore emerged as the largest seller for the month, reducing its gold reserves by 5 tonnes, leading to year-to-date net sales of 7 tonnes and overall holdings of 223 tonnes.
The RBI’s gold acquisitions have surged by five times compared to the amount purchased during the same period in 2023, as per WGC data.
As of now, the RBI’s total gold reserves stand at 890 tonnes, with 510 tonnes stored within India.
The WGC report highlighted that central banks that increased their gold holdings during the month include Poland, which added 21 tonnes, and Uzbekistan, which acquired 9 tonnes.
These substantial gold purchases by central banks have also contributed to rising prices of the precious metal in the global market.
A significant portion of the RBI’s gold reserves is held abroad in secure custody with the Bank of England and the Bank of International Settlements, while around one-third is stored in the RBI’s vaults located in Nagpur and Mumbai.
In 2024, the Reserve Bank transferred 100 metric tonnes of gold from vaults in the United Kingdom to its own vaults in India, as there was adequate domestic storage capacity available.
This relocation of gold reserves is anticipated to yield savings by eliminating high vault fees previously paid in the UK.
