RBI’s Gold Reserves Surge 57% in FY25 to ₹4.32 Lakh Crore — A Golden Hedge Against Global Uncertainty

India’s central bank has stacked its vaults with gold — and the reasons go beyond just shiny numbers.

According to the Reserve Bank of India’s annual report, the value of gold held by the RBI rose 57.12% year-over-year, reaching a record-breaking ₹4.32 lakh crore as of March 31, 2025. The sharp surge was due to:

• 🟡 An addition of 54.13 metric tonnes of gold
• 📈 A significant rise in global gold prices
• 💱 The depreciation of the Indian rupee against the U.S. dollar

The move signals a strategic shift in India’s foreign reserve policy as it braces for mounting global economic uncertainty.

📦 RBI Adds Over 54 Metric Tonnes of Gold in FY25

In FY25, the RBI added 54.13 metric tonnes of gold to its reserves — one of the largest annual increases in recent years. This takes total RBI gold holdings to 879.58 metric tonnes, up from 822.10 metric tonnes a year ago.

This accumulation reflects India’s alignment with global central banks that are boosting their non-dollar assets, preparing for a world that’s increasingly volatile — both economically and geopolitically.

📊 Valuation Surge Powered by Global Gold Prices

Gold prices hit historic highs in FY25, with domestic gold crossing ₹1,00,000 per 10 grams in April 2025 — a 30% jump from the previous year. This rally was driven by:

• Fears of global recession
• A weaker U.S. dollar
• Increased demand from central banks
• Geopolitical tensions in key trade corridors

Higher international gold rates meant that even without significant additions, the rupee value of RBI’s gold rose substantially.

💱 INR Depreciation: The Silent Booster

The Indian rupee weakened against the U.S. dollar in FY25. Since gold is priced in dollars, the drop in the INR further inflated the rupee-denominated valuation of RBI’s holdings.

Even if global gold prices had remained flat, the currency effect alone would have caused RBI’s assets to swell in value.

🧾 Breakdown: Issue Department vs. Banking Department

RBI’s gold is divided between two departments:

• Banking Department:
• 568.20 metric tonnes (FY25)
• ₹4.32 lakh crore valuation
• Issue Department:
• 311.38 metric tonnes (FY25)
• Used to back currency issuance

Compared to FY24, both departments saw slight increases in quantity, but a massive jump in rupee valuation — due to price and currency dynamics.

🌍 U.S. Tariffs & Global Trade Anxiety: The Trump Effect

One major external catalyst influencing central bank behavior is the return of Donald Trump’s tariff talk in the U.S. 2025 election cycle.

Trump’s proposed plans include:

• A universal 10% tariff on all imports
• Up to 60% tariffs on Chinese goods

Such protectionist moves could:

• Trigger global trade wars
• Disrupt supply chains
• Hurt emerging markets like India
• Cause investors to flock to gold as a safe-haven

💡 More tariffs → more instability → more gold buying → higher prices.

India, with its exposure to both U.S. and Chinese trade routes, is wisely hedging its reserve portfolio with gold. The RBI’s decision to buy big and buy now aligns with this strategic macroeconomic foresight.

🇮🇳 Why This Matters for India

• Gold now makes up over 11% of India’s forex reserves — up from 9.3% last year.
• India has quietly repatriated over 500 tonnes of gold to domestic vaults — the largest transfer since 1991.
• With rising external risks, a stronger gold base boosts rupee credibility and financial stability.

High gold prices may pinch retail buyers, but for India’s central bank, the metal has become an essential shield.

✅ Key Takeaways

• 📈 RBI’s gold holdings rose by ₹1.57 lakh crore YoY, reaching ₹4.32 lakh crore.
• 🪙 54.13 metric tonnes of gold were added in FY25 — a 7% increase in volume.
• 💹 Global gold prices and INR depreciation boosted valuation.
• 🌐 U.S. tariff threats and global trade uncertainty are pushing central banks toward gold.
• 🇮🇳 Gold now forms 11–12% of India’s forex reserves, offering protection against dollar volatility.

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