What was that buzz about RBI selling gold?
A trade in yellow gold
The RBI rubbished reports that it was selling gold from its reserves or trading in the yellow metal. "The fluctuation 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," RBI said on its handle on the micro-blogging website Twitter.
What was the buzz?
The buzz started after a report that the RBI was selling gold from its reserves. The report said RBI has bought gold worth $5.1 billion and sold about $1.15 billion of gold since the start of its business year in July. The value of gold in the country’s forex reserves amounted to $26.7 billion on 11 October.
Trading in bullion
Going with the calculation shown in the news report, RBI appears to have started trading in gold more actively since adopting the Bimal Jalan Committee report on its economic capital framework.
What is the Jalan panel?
The Bimal Jalan Committee was set up last year amid heightening debate over sharing the Reserve Bank’s surplus income with the government to fund its deficit.