The Central Bank of India, the Reserve Bank of India, currently has 879 tonnes of gold, the total price is $ 97 billion, and in 2024 plans to offer aggressive purchases of 72.6 tonnes of gold for its reserves.
All the central banks of the world are increasing the purchase of gold and RBI has also bought a total of 8.8 tonnes of gold in only two months, January and February 2025 after the RBI became the second largest central bank in buying gold in 2024. RBI has been buying a large amount of gold since 2017. For the first few years, the RBI had taken a soft trend in the purchase of gold.
On Wednesday, the price of gold in the global market crossed the level of $ 3,300 an ounce for the first time. Last year, the reason for the unprecedented increase in gold prices is also heavy purchases of gold by central banks around the world. The total amount of gold purchased by central banks around the world in the last three years ie 2022, 2023 and 2024 is more than 1,000 tonnes and in these years central banks bought 1,082 tonnes, 1,037 tonnes and 1,045 tonnes of gold respectively. In the first two months of 2025, these banks bought 44 tonnes of gold. There has also been a significant increase in gold prices in recent years. Currently, the price has crossed $ 3,300, which is a record height. Globally, gold prices have increased by 40 per cent in the last one year and will increase by 25 per cent so far in 2025. In 2024, the prices rose by 28 per cent, while in 2023 prices saw a 15 per cent increase. Global gold prices increased by about $ 1,000 an ounce in a period of one year from April 2024 to April 2025. Such a rapid growth is the biggest bounce seen in the last few years. Gold prices were seen in previous years, but the speed of growth was not so intense. Gold prices are currently in the currently due to the trade war launched by the US, which has reached its peak after China’s retaliation. In addition, increasing geopolitical stress and weakening of the dollar to the lowest level of the last three years is also responsible for this. This has increased the demand for gold from central banks as well as investors, as investment in gold is considered to be a defense against the risk of any uncertainty and hence it is considered a safe investment.
Why are the central banks buying a huge amount of gold?
After the war between Russia and Ukraine in 2022, the US imposed sanctions and freeze the dollar-valuable properties of Russia’s central bank. Therefore, the central banks are now giving priority to gold reserves compared to the reserves placed as dollars, which is a larger part of the purchase of gold, and therefore gold is being purchased aggressively. This is the reason that since 2022, there has been a huge jump in the purchase of gold by central banks.
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