NextFin News - The Reserve Bank of India (RBI) may have offloaded a portion of its gold holdings to shield its foreign-currency assets from the impact of rising yields, according to a new report from Bloomberg Economics. The analysis suggests that the central bank’s recent reserve management strategy has shifted toward protecting the valuation of its non-gold assets as global bond markets face sustained pressure. While the RBI has historically been a consistent accumulator of the precious metal, the report indicates a tactical pivot aimed at maintaining the overall stability of India’s $600 billion-plus foreign exchange pile.
Abhishek Gupta, a senior economist at Bloomberg Economics who authored the report, has long maintained a focus on the RBI’s balance sheet mechanics and currency intervention strategies. Gupta is known for a data-driven, often contrarian approach to Indian macroeconomics, frequently highlighting the hidden costs of the central bank’s aggressive rupee management. His latest finding—that the RBI is potentially selling gold—stands in contrast to the broader trend of emerging market central banks increasing their bullion exposure to diversify away from the U.S. dollar. This perspective currently represents a minority view among sell-side analysts, many of whom still expect the RBI to remain a net buyer of gold in the long term.
The Bloomberg Economics report points to a discrepancy between the RBI’s weekly statistical supplements and the valuation of its gold reserves. According to Gupta, the decline in the value of gold held by the central bank cannot be fully explained by price fluctuations alone, suggesting a reduction in physical volume. This maneuver would provide the RBI with additional liquidity to defend the rupee or to offset the mark-to-market losses on its massive holdings of U.S. Treasuries and other sovereign bonds. As of June 2, 2026, spot gold is trading near $4,517 per ounce, reflecting a significant appreciation over the past two years that may have tempted the central bank to book profits.
However, this interpretation is not without its detractors. Several institutional desks in Mumbai argue that the perceived "sale" might simply be a result of gold swaps or accounting adjustments related to the revaluation of reserves. Data from the first quarter of 2026 showed India’s gold reserves actually increased slightly to 880.52 tonnes from 880.18 tonnes at the end of 2025, according to official figures. Critics of the Bloomberg Economics report suggest that the RBI is unlikely to abandon its strategic goal of increasing gold’s share in its total reserves, which currently sits well below the levels maintained by peers like Russia or China.
The conclusion that the RBI has turned into a seller remains a scenario-based deduction rather than a confirmed policy shift. The validity of this analysis depends heavily on the transparency of the RBI’s reporting and the volatility of the global interest rate environment. If U.S. yields continue to climb, the pressure on the RBI to liquidate liquid assets to support the rupee will only intensify. For now, the market remains divided on whether the central bank is truly parting with its "safe haven" assets or merely engaging in sophisticated balance sheet optimization. The RBI has not officially commented on the Bloomberg Economics report.
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