Gold ETFs see ₹8,363 crore inflows in Sept- up 578% as prices cross ₹1 lakh

Net inflows increase by 578.28% at Rs 8363.13 crore in September 2025 ahead of Dhanteras, up from Rs 1232.99 crore last year; Inflows witnessed a CAGR growth of 69.53% over past 5 years

This Dhanteras, investors aren’t just buying gold bangles — they’re buying Gold ETFs, and in record numbers. According to data from ICRA Analytics, inflows into Gold Exchange Traded Funds (ETFs) have surged over six-fold in September 2025, touching ₹8,363 crore, compared to ₹1,232 crore during the same month last year — a 578% jump year-on-year.

 

In fact, gold ETF inflows have grown at a remarkable 69.5% CAGR over the past five years, showing how steadily investors have embraced this digital form of gold ownership. The trend underscores how geopolitical uncertainty and soaring gold prices have pushed Indians toward paper gold, which offers the shine without the storage hassles. 

Gold ETFs register over six-fold jump in inflows in September 2025 on a year-on-year basis amid geopolitical tensions and surge in prices: ICRA Analytics

 

Why Gold Is Back in the Spotlight

 

The rush to gold ETFs comes as domestic gold prices have crossed ₹1 lakh per 10 grams — an all-time high.

 

Global factors have aligned to make gold the “go-to” safe-haven asset again. From escalating geopolitical tensions in Europe and the Middle East to central banks aggressively buying gold, and expectations of US interest rate cuts, the yellow metal has reasserted its status as the world’s crisis currency.

 

“Escalating geopolitical tensions, global uncertainties, and the overall dynamic outlook seem to be boosting the safe-haven appeal of bullion,” said Ashwini Kumar, Senior Vice President and Head – Market Data, ICRA Analytics. “Investors favour gold ETFs for their liquidity, transparency, cost-effectiveness, and ease of trading compared to physical gold.”

 

Surge in Gold-Linked Assets

 

The numbers tell a clear story of investor confidence:

 

Net inflows: ₹8,363 crore in September 2025 vs ₹1,233 crore a year ago — up 578%.

 

Assets under management (AUM): ₹90,136 crore, up 126% year-on-year from ₹39,823 crore.

 

Month-on-month inflows: up 282% from ₹2,189 crore in August 2025.

 

There are now 22 Gold ETFs available in India, with four new funds launched in 2025 alone, reflecting both investor appetite and asset managers’ enthusiasm for this category.

 

Over the past year, the average one-year return for gold ETFs has been 50.97%, while the five-year CAGR stands at 16.93% — comfortably beating inflation and many traditional fixed-income investments.

 

Average returns on Gold ETFs as on Sep 30, 2025: 

Source: Amfi data

 

Top 5 Funds based on 5-year CAGR 

* Less than 1-year Absolute returns, Greater than or Equal to 1 year Compound Annualized returns

 

Source: MFI 360 Explorer

 

 “Rally in gold price is attributed to geo-political reasons supported by dynamic uncertainties. The demand for physical gold has steepened generally across various countries. The advent of future and ETF has brought investors to non-physical gold and hence this asset class has become quite sensitive to the overall global developments. This shall continue further and keep the gold price firm in festive season and beyond in near to mid-term. Benign rate is also supporting gold prices. So, investors will continue to remain optimistic about the outlook, amid caution due to high valuations and potential volatility,” Kumar added.

 

What’s Driving the Rush to Gold ETFs

 

The spike in ETF inflows comes from a combination of macro triggers and personal finance trends:

 

Geopolitical Tensions: Wars and trade disruptions have made investors globally seek safe-haven assets.

 

Central Bank Buying: Global central banks, including India’s RBI, have increased gold reserves, reinforcing confidence.

 

Rupee Depreciation: The weakening of the Indian rupee makes gold more valuable in rupee terms.

 

Festive Demand: Ahead of Dhanteras and Diwali, investors traditionally buy gold — but this time, many chose ETFs over jewellery.

 

Ease & Safety: Gold ETFs remove concerns about purity, theft, or making charges. They’re traded just like mutual funds and backed by physical gold stored in vaults.

 

Unlike physical gold, where investors face storage and purity worries, ETFs provide a transparent, low-cost, and easily tradable way to participate in the gold rally.

 

Investor Strategy: Stay Smart Amid the Gold Rush

 

While gold prices have risen sharply, experts advise phased or staggered investing, especially after festive spikes.

 

“Strategic entry after short-term corrections, such as post-Diwali, could offer attractive opportunities for phased investments,” said Kumar.

 

Financial planners agree that gold should form about 10–15% of an investor’s portfolio, primarily as a hedge against inflation and market volatility. The current rally, though strong, has made valuations high — meaning short-term corrections can’t be ruled out.