RBI’s Decision to Halt Gold Purchases: What’s Behind the Pause?

Gold Purchases:

In FY26, the Reserve Bank of India (RBI) has not made any purchases of gold, keeping its gold reserves unchanged. This decision comes amidst a backdrop of fluctuating global gold prices, as experts predict that gold prices may drop in the future. The RBI’s move reflects caution in the face of global economic trends and the expectation of a price dip.

Gold Purchases and Reasons Behind the RBI’s Decision

Over the past five years, gold prices have surged by more than 80%, mainly due to rising geopolitical tensions, economic uncertainties, and the imposition of financial sanctions worldwide. Consequently, gold has become a favored investment option, regarded as a safe-haven asset. However, experts are forecasting a possible decline in gold prices due to easing political tensions and signs of the U.S. Federal Reserve lowering interest rates.

Current Gold Reserves of the RBI

As of May 2025, the RBI’s gold reserves remained at 880 metric tons, unchanged from March 2025. Similarly, during the last quarter of 2023, the RBI paused its gold purchases. The RBI’s conservative stance comes amid market projections that gold prices may decrease from their current high of \$3,445 per troy ounce.

Global Central Bank Trends

Despite RBI’s cautious approach, global central banks are expected to continue increasing their gold holdings. According to the World Gold Council’s survey, 95% of major central banks plan to boost their gold reserves in the next 12 months, up from 81% last year. This shift underscores the importance of gold in maintaining financial stability during times of economic crisis.

While the RBI has paused its gold purchases temporarily, the overall outlook for gold remains positive. Analysts predict that the long-term importance of gold will only increase as a secure investment, even though short-term fluctuations in prices may continue.

Disclaimer: This article is strictly for informational purposes only. It is not a solicitation to buy or sell in precious metal products, commodities, securities, or other financial instruments.

Also Read:Why Saif Ali Khan Might Lose His ₹15,000 Crore Royal Legacy