RBI denies report of trading in gold reserves

The Reserve Bank of India (RBI) has refuted media reports claiming that the central bank has been selling gold. RBI said that it has not sold any gold or indulged in trading the yellow metal. “Reports have appeared in certain sections of media that RBI has been selling/ trading in gold of late. It is clarified that RBI has not sold any gold or trading in it,” RBI said on twitter.

The clarification comes after a report in the Economic Times said that the Reserve Bank of India (RBI) has sold gold worth $1.15 billion from its reserves, citing RBI’s weekly statistical supplement data. According to the business daily, RBI’s weekly statistical supplement data suggested that since the beginning of July 2019, RBI had bought gold worth $5.1 billion and sold about $1.15 billion.

The newspaper had reported citing RBI data that the value of gold in the country’s forex reserves amounted to $26.7 billion on October 11, 2019. The report quoted analysts as saying, “The stock of gold in forex reserves has traditionally been revalued only once a month. Any changes in the interim weeks could be attributed to the purchase or sale of gold.”

However, the central bank has said that the fluctuation in value depicted in Weekly Statistical Supplement (WSS) is due to change in frequency of revaluation from monthly to weekly basis and is based on international prices of gold and exchange rates. The report quotes sources close to RBI saying that it’s likely that the central bank has sold some of the gold it’s bought recently. RBI may also be trading in gold as part of treasury operations, the way it trades in currencies, the report added the sources as saying.

Shekhar Ghosh is consulting editor, Indoasiancommodities.com. He has edited and written for publications like Business India, Business Standard, Business Today, Outlook and many other international publications. He can be reached at shekhar.ghosh@indoasiancommodities.in.

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