RBI buys 1.5 Times more Gold in just Four Months than whole of 2023
India’s gold reserves have gone up somewhat in the first four months of 2024 as the Reserve Bank of India continues to accumulate 1.5 times more gold in this period as compared to the gold purchase made in the previous year. This significant increase in gold holdings explicates the major factors that RBI takes into account while acquiring the constituent of foreign exchange reserves as well as the accumulation of the hedge for the future scenario of India’s financial market as attempts by considering the volatility of the global economy.
The Indian central bank, the Reserve Bank of India, which started gold shopping from January through April, is a solid manifestation of the fact that the institution takes great care in the management of the country’s monetary policy. This way, the central bank not only enriches the stock of gold for securing and strengthening the Indian financial system but also expresses its confidence in the long-term stability of the value of the precious metal. This action may be in line with what other central banks around the world are doing of accumulating gold as a reserve and hedging against unknown market risks including geo-political ones given today’s volatile global economy; something that giants such as China and Russia have been doing recently.
In an assessment on behalf of RBI, an economist opined as follows “The world’s emerging market central banks are buying gold as global uncertainties increase, adding 290 tones in the first quarter 2024 and accounting for a quarter of the total global demand for gold”, and further noted that “These central banks are implying that if one has to live in costly conditions as in the current world; then the right way to embrace the situation is to opt for
