NEW DELHI— India now holds 15 percent of the $23 trillion global gold market, according to a new report released on Monday. While global foreign exchange reserves stand at around $12.5 trillion, the report highlights gold’s rising significance in global asset allocation.
The July 2025 edition of DSP Mutual Fund’s Netra report notes that 65 percent of all mined gold is in the form of jewelry. The report suggests that even a modest shift—just 5 percent of global forex reserves—into gold could spark a sustained and substantial price rally.
Central banks worldwide have been increasingly stockpiling gold. Between 2000 and 2016, central bank gold purchases totaled $85 billion. In contrast, in just one year—2024—central banks bought gold worth $84 billion alone.
Since 2022, central banks have been buying nearly 1,000 tonnes of gold annually, accounting for more than a quarter of the yearly global mining output. This trend reflects a growing preference for non-dollar reserve assets, as concerns rise over the volatility of U.S. Treasury bonds.
“Demand for gold remains strong for now,” the report states, citing this global pivot toward gold as a safer, more stable alternative.
In India, the Reserve Bank of India (RBI) currently holds 880 metric tonnes of gold, according to the latest figures. The RBI has not added to its holdings in FY26, possibly waiting for a correction after gold prices surged more than 80 percent over the last five years amid persistent geopolitical and trade tensions.
Gold recently reached a new all-time high in inflation-adjusted terms and remains firmly in a bull market. The Netra report attributes this to the lack of viable alternatives to the U.S. dollar as a reserve currency.
“The euro continues to display vulnerabilities due to the fragile fiscal structure of the Economic and Monetary Union (EMU). The Chinese yuan is still not market-driven or politically acceptable enough to be a true reserve currency. Meanwhile, other contenders are too small to attract serious reserve asset allocations,” the report said.
The report also pointed to strong operating cash flows in India, noting elevated OCF (Operating Cash Flow) margins as a healthy sign for capital allocation and corporate governance across Indian businesses. (Source: IANS)
