Safe haven: RBI brings back another 104MT of gold

MUMBAI: The RBI brought a large quantity of gold back to India during Oct 2025-March 2026, even as the share of the yellow metal in forex reserves rose sharply with soaring gold prices and a decline in foreign currency assets.

According to data released by RBI in its half-yearly report of foreign exchange reserves, domestically held gold increased from 575.8 metric tonnes at end-Sept 2025 to 680 metric tonnes at end-March 2026. This implies that the RBI brought 104.2 metric tonnes of gold into the country during the six-month period. Gold held in safe custody abroad with the Bank of England and the Bank for International Settlements declined from 290.4 metric tonnes to 197.7 metric tonnes.

The central bank’s total gold holdings rose marginally from 880.2 metric tonnes (valued at $97.4 billion) at end-Sept 2025 to 880.5 metric tonnes (valued at $115.4 billion) at end-March 2026. The share of gold in total foreign exchange reserves (in value terms) increased sharply from 13.9% to 16.7%.

Amid heightened geopolitical tensions, several central banks have repatriated gold reserves to bolster sovereignty and mitigate foreign custody risks.

France’s Banque de France completed the transfer of 129 metric tonnes from the New York Federal Reserve to Paris vaults in early 2026.

RBI had earlier repatriated 274 to 280 tonnes during 2023 to 2025, including 64 tonnes in mid-2025 and around 100 tonnes from the UK, raising domestic holdings above 65% of reserves. Serbia’s National Bank brought back its entire holding of around $6 billion gold stock in July 2025 to avoid global hubs.

Germany’s Deutsche Bundesbank is weighing options for its 1,236 tonnes in New York, with discussions rising in Jan 2025 after a former official said it was “too risky.” World Gold Council data showed 59% of central banks stored more gold onshore by 2025, up from 50% in 2020, led by emerging markets wary of sanctions, although some countries such as Poland continue with a mixed approach.

RBI foreign currency assets declined from $579.2 billion at end-Sept 2025 to $552.3 billion at end-March 2026. The RBI maintained a multi-currency portfolio comprising the US dollar, euro, pound sterling, and Japanese yen, with reserves expressed in US dollar terms.

The deployment pattern of these assets remained largely stable with minor shifts. Investment in securities fell from $489.5 billion, or 84.5% of FCA, to $465.6 billion, or 84.3%. Deposits with other central banks and the Bank for International Settlements rose slightly from $46.1 billion, or close to 8%, to $46.8 billion, or 8.5%.

Deposits with commercial banks overseas declined from $43.5 billion, or 7.5%, to $39.8 billion, or 7.2%.

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