The Reserve Bank of India (RBI) in its Half Yearly Report on
Management of Foreign Exchange Reserves has said that the RBI added nearly 25
tonne of gold to its reserves in the second half of FY25, a period which saw a
rally in the prices of the precious metal. The central bank now holds 879.59
tonne of gold in its reserves as against 854.73 metric tonne it held at
end-September 2024. In FY25, the central bank added over 57 tonne of gold to
its reserves, in a period which saw a 30 per cent rally in the prices of the
precious metal. This is the largest yearly addition in the last seven years.
It stated that the quantum of the precious metal stored
locally grew marginally to 511.99 tonne. Apart from the gold stored in vaults
locally, 348.62 tonne was in safe custody of Bank of England and Bank for
International Settlements (BIS) and 18.98 tonne was held in the form of gold
deposits. It can be noted that in the first half of FY25, the RBI had moved a
larger quantum of gold to local vaults. The overall quantity of the precious
metal stored in local safes stood at 510.46 tonne as of September 30, which was
up from over 408 tonne on March 31, 2024.
The movement of the commodity, happening at a time of
increased geopolitical tensions globally, was said to be one of the biggest
movements of gold undertaken by India since 1991, when it had to pledge a
substantial part of the gold holding to tide over a foreign exchange crisis
that resulted in its movement out of vaults. Further, it stated share of gold
in the total foreign exchange reserves increased to 11.70 per cent as at
end-March 2025 from 9.32 per cent six months ago. Besides, it said the overall
forex reserves decreased to $668.33 billion in March 2025 from $705.78 billion
at end-September 2024.
Source: Ace Equity
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