Reserve Bank of India Gold Purchases Trebled in H1 FY21

SEATTLE (Scrap Monster): The Reserve Bank of India (RBI) gold purchases more than tripled during the initial six-month period of the current financial year. The boost in purchases during H1 FY21 was mainly on account of rising safe-haven appeal of the yellow metal amidst economic impacts caused by Covid-19 pandemic.

According to the central bank’s report on Management of Foreign Exchange Reserves, it bought 15.24 tonnes of gold in April-September this year. This compares with purchases of 5.61 tonnes during the corresponding half-yearly period last financial year. Also, the purchases during H1 FY21 recorded notable decline upon comparison with 34.84 tons purchased during the six-month period ended March 2020.

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During the initial half of FY21, gold prices surged higher from $1,578.55 per Oz at the beginning of the period to $1,886.90 as on September 30, 2020. Also, it had touched the peak of $2,067.15 in early August this year.

The total gold holdings of RBI stood at 668.25 tonnes as on September 30, 2020. This compares with 653.01 tonnes as of end-March this year.

Meantime, gold ETFs in the country recorded net outflows for the first time after seven straight months of inflows. The outflows amounted to INR 141 crore in the month of November this year, mainly due to profit booking by investors and dip in gold prices.