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RBI Boosts Domestic Gold Reserves by 100 Tonnes in H1 2024

The Reserve Bank of India (RBI) has raised its domestic gold reserves by over 100 metric tonnes in the first half of the fiscal year, ending in September. This increase also boosted gold’s proportion within the country’s total foreign exchange reserves, reflecting the central bank’s intensified gold acquisitions.

RBI Boosts Domestic Gold Reserves by 100 Tonnes in H1 2024

As of the end of September 2024, the Reserve Bank of India (RBI) reported holding a total of 854.73 metric tonnes of gold. Out of this, 510.46 metric tonnes were stored domestically, while 324.01 metric tonnes were safeguarded abroad with the Bank of England and the Bank for International Settlements (BIS). An additional 20.26 metric tonnes were allocated as gold deposits, according to RBI’s recent half-year report on foreign exchange reserves for April to September 2024. In terms of value in U.S. dollars, gold’s share in India’s total foreign exchange reserves grew from 8.15% in March to 9.32% as of September 30, reflecting a notable increase in the central bank’s gold holdings.

RBI Governor Shaktikanta Das stated in June that although the amount of gold held overseas had been largely unchanged for a long time, new patterns showed that the central bank was buying more gold as part of its reserve management strategy, which increased the amount held outside of India.

Governor Shaktikanta Das insisted, "We have domestic capacity now, and we felt part of the gold should be stored within the country," at the RBI's June monetary policy press conference. That's it. There is nothing further to infer from it. According to the RBI's most recent half-yearly report, its foreign exchange reserves increased from $646.42 billion at the end of March to $705.78 billion as of September 30.

The Reserve Bank of India's foreign currency assets, held in major global currencies, are reported in U.S. dollar terms. Changes in these assets primarily result from the RBI's foreign exchange purchases and sales, income generated from deploying foreign exchange reserves, external aid receipts to the central government, and fluctuations due to asset revaluation, according to the central bank.

As of September, the Reserve Bank of India's total foreign currency assets amounted to $617.07 billion. Out of this, $515.30 billion, representing 83.51%, was allocated to securities, while $60.11 billion was deposited with other central banks and the Bank for International Settlements (BIS). The remaining $41.66 billion consisted of deposits with commercial banks overseas. In comparison, the RBI's total foreign currency assets were $570.95 billion as of March 31, with $468.99 billion, or 82.14%, invested in securities.

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