India sold about $174 billion in U.S. Treasury bonds this year to support its currency and boost gold reserves. According to data from the Reserve Bank of India, the move formed part of a broader reserve diversification effort.
U.S. Treasury holdings now make up roughly one-third of the country’s foreign exchange assets. They are down about 40% from last year and roughly 26% from their 2023 peak (Ed. note: holdings are at a five-year low).
India is selling Treasuries to accumulate gold and shift away from dollar-denominated assets. This change parallels actions by other BRICS members, including Russia and China, which have reduced U.S. bond holdings.
Win Thin of the Bank of Nassau said, “There is still room for India to lighten up its US Treasury holdings.” Finance Minister Nirmala Sitharaman called the RBI move “very considered”.
Michael Brown, a strategist at Pepperstone, said “The trend is very much embedded at this point,” and added a potential trade agreement “will simply see holdings stabilize, rather than India go on some sort of mass buying spree.”
