RBI’s Gold Reserves Soar with 57.5 Tonne Purchase in FY25

In a significant move reflecting global financial anxieties and a shift in reserve strategies, the Reserve Bank of India (RBI) added 57.5 tonnes of gold to its reserves in FY25, the second-highest annual addition since it began accumulating gold in 2017. This comes amid a dramatic surge in gold prices, driven by global uncertainties, geopolitical risks, and weakening of the US dollar.

Why in News?

The RBI’s gold purchase has gained attention due to Rising gold prices crossing ₹1 lakh per 10 grams in April 2025. A sharp 30% annual rise in gold rates, influenced by global market volatility, tariff wars, and US dollar weakness.

Key Highlights

• RBI purchased 57.5 tonnes of gold in FY25, second only to a previous high since 2017.
• Total gold reserves as of March 2025: 879.6 tonnes, up from 822.1 tonnes a year earlier.
• Global trend: Central banks globally are stockpiling gold due to currency risk and sovereign debt concerns.

Objectives of RBI’s Gold Purchase

• Diversify foreign exchange reserves beyond traditional assets like USD and US Treasuries.
• Hedge against currency volatility and geopolitical uncertainties.
• Preserve value as gold retains purchasing power over time.

Background

• RBI resumed gold accumulation in December 2017 after a gap.
• In FY24, RBI had added 27.47 tonnes of gold.
• Amid fears of US debt default and the dollar’s instability post-Trump’s re-election in Nov 2024, gold became increasingly attractive.

Static Facts

• Gold touched $3,230 per ounce globally in 2024.
• Gold’s price history shows resilience: rose 21% during 2008 crisis.
• Gold has low correlation with equities/bonds, making it a portfolio hedge.

Overall Significance

• Signals a strategic shift in India’s reserve management.
• Enhances RBI’s financial strength and increases investor confidence.
• Aligns with global central bank trends, including moves by China and Russia to accumulate gold.

Summary/Static	Details
Why in the news?	RBI’s Gold Reserves Soar with 57.5 Tonne Purchase in FY25
Gold bought by RBI in FY25	57.5 tonnes
Total RBI gold reserves (Mar 2025)	879.6 tonnes
FY24 gold addition	27.47 tonnes
Reason for buying	Dollar volatility, safe-haven investment, rising gold prices
Price of gold (April 2025)	₹1,00,000 per 10g; $3,230 per ounce globally
Strategic impact	Boosts reserves, hedges risk, aligns with global central banks