Hot on the heels of yesterday’s news about 2018’s slump in Indian consumer demand, comes today’s report that India’s central bank BOUGHT gold in 2019. This is especially significant as it is the first time India has bought gold for their central reserve since 2009. Such a move would indicate India now sees more of a need for a universal asset than they have since the market drop of 2008-2009.
Or, that India wants to bolster the perceived value of the rupee in the face of last year’s drop. Or both these reasons might be true. Whatever the case, India buying gold for the first time in a long time just adds more support for gold, which so far has failed to rise above 1300 USD/oz in 2019. We think this is a smart move by India, signaling it is still in the world economic picture.