Mumbai, Jan 7 (IANS): The Reserve Bank of India (RBI) bought another eight tonnes of gold in November 2024 as Central banks around the world continued their buying spree with a collective purchase of 53 tonnes of the precious metal during the month, according to the latest World Gold Council (WGC) report.

The decline in gold prices during November, following the US election, may have provided some central banks with the added impetus to accumulate the precious metal, the report pointed out.

RBI has, like other central banks, been buying gold as a safe-haven asset. The strategy of holding gold is primarily aimed at hedging against inflation and reducing foreign currency risks, especially in times of uncertainty triggered by geopolitical tensions.

With the addition of eight tonnes of gold to its reserves in November, the RBI has increased its buying to 73 tonnes in the first 11 months of 2024 and its total gold holdings to 876 tonnes, maintaining its position as the second largest buyer during the year after Poland.

The People's Bank of China (PBoC) has resumed gold purchases after a six-month gap, adding five tonnes of gold to its reserves, increasing its year-to-date net purchases to 34 tonnes and its total reported gold holdings to 2,264 tonnes (5 per cent of total reserves), the report said.

Meanwhile, the Monetary Authority of Singapore was the month's largest seller, reducing its gold reserves by 5 tonnes, bringing the year-to-date net sales to 7 tonnes and overall gold holdings to 223 tonnes, it added.

The RBI’s gold purchases have shot up by five-fold over the quantity of the precious metal bought in the same period of 2023, according to WGC figures.

According to the data, the RBI’s total gold reserves have now gone up to 890 tonnes, of which 510 tonnes are held in India.

According to WGC, the central banks that bought gold during the month are those of Poland adding 21 tonnes and Uzbekistan buying nine tonnes.

These large purchases of gold by central banks have also been driving up prices of the precious metal in the global market.

More than half of the RBI’s gold reserves are held overseas in secure custody with the Bank of England and the Bank of International Settlements, while approximately a third is stored in the RBI’s vaults in Nagpur and Mumbai.

The Reserve Bank shifted 100 metric tonnes of its gold kept in bank vaults in the United Kingdom to its own vaults in India in 2024 as there was enough domestic storage capacity in the country.

The shifting of the gold reserves is expected to result in a saving in the high fees that were paid for the use of vaults in the UK.