Gold reserves rise $31 bn in FY26 as RBI buys, prices hit record high

India's gold reserves climbed to $108 billion as global prices surged and the RBI added to its holdings, diversifying forex reserves amid rising global uncertainty

India’s gold reserves increased by $31 billion in the current financial year so far, reaching $108 billion as of the week ending October 17, according to the latest data released by the Reserve Bank of India (RBI). The reserves stood at $77 billion at the end of March this year.

 

Economists attributed the sharp rise to both fresh gold purchases by the RBI and valuation gains driven by a surge in international gold prices.

 

“The increase reflects a combination of actual buying by the central bank and the surge in gold prices amid global uncertainty,” said Gaura Sen Gupta, chief economist, IDFC FIRST Bank.

 

 

Gold prices remain elevated amid global uncertainty

 

Gold prices have remained high through 2025 as investors sought safe-haven assets amid geopolitical tensions and expectations of lower global interest rates. Central banks across emerging markets, including India, have been diversifying their foreign exchange reserves by increasing gold holdings.

 

Gold prices rose to $4,251 per ounce, compared with $2,857 per ounce in the last week of the previous financial year.

 

Gold’s share in reserves rises sharply

 

Gold now accounts for a higher share of India’s total foreign exchange reserves, which have also seen moderate gains from other components such as foreign currency assets. At the end of September, gold accounted for 9 per cent of total reserves, up from 4 per cent a year earlier.

 

Foreign exchange market participants said the shift appears strategic, as India is strengthening its external balance sheet by holding more non-currency assets that hedge against currency volatility and external shocks.

 

“By raising the share of gold in its reserves, the RBI is reducing dependence on dollar assets while building a stronger hedge against currency and interest-rate risks. The move also reflects a broader strategy to strengthen India’s external buffers amid global uncertainty and rising safe-haven demand,” said a market participant.