RBI Shifts 100 Tonnes of Gold Reserve Back to India from UK
The Reserve Bank of India has recently transferred approximately 100 tons of gold from British vaults to India. It is expected to bring more in the upcoming months. It is stated that the relocation was made for various storage and logistical reasons. With this move, the RBI will be able to save on storage costs that it pays to the Bank of England. This is the first time since 1991 that the country has transferred such a huge amount of gold overseas. It was decided to move some of the gold to India because the stock was rapidly going high in foreign nations.
More than half of the RBI’s gold reserves are kept overseas by the Bank of England and the Bank of International Settlements, and the third is stored in India. Not just India, but most nations keep their gold in the vaults of England and such locations. Certain studies state that the percentage of gold kept in these two nations (the US and the UK) is said to be around 50%.
RBI Gold Reserve
According to the annual data of the RBI, the bank held 822.1 metric tons of gold as a part of its foreign exchange. It was around 794.63 metric tons last year. The gold is kept in vaults in RBI buildings on Mumbai’s Mint Road and Nagpur in India.
The Gold Holdings in the International Market
The central banks worldwide are expanding their gold holdings to keep as a hedge against currency instability and geopolitical threats. The Reserve Bank of India (RBI) began buying gold a few years ago.
With 822 tons of total gold reserves, India ranks fourth out of all the nations with the largest reserves, according to the World Gold Council. China leads the list, in part because of the recent gold purchase by the nation’s central bank.
China leads another Asian powerhouse, Japan, with 845.97 metric tons of gold reserves, behind the Asian giant with a total declared reserve of 2,262.45 metric tons.
This is true because, unlike the Euro or the US dollar, which serves as the global reserve currency, gold is not governed by a single nation, giving its bearer more autonomy.
Further, the price increase is not the only factor suggesting the surge in demand for gold; there is also a notable increment in demand for actual gold as opposed to gold EFTs, establishing a diversified trend of consumption and pointing to a shift in the same.
