Gold ETFs See Record Inflows Amid Market Volatility in FY26
The Gold Edge: ETF net inflows up 4.5x in FY26
The Economic TimesImage: The Economic Times
In FY26, net inflows into gold exchange-traded funds (ETFs) reached a record ₹68,867 crore (approximately $8.3 billion USD), a 364% increase from the previous year. This surge, driven by geopolitical risks and rising gold prices, pushed gold ETFs' share of mutual fund inflows to nearly 10%, significantly higher than the historical 1-3% range.
- 01Net inflows into gold ETFs surged to ₹68,867 crore in FY26.
- 02Inflows increased by 364% year-on-year, marking the fastest growth across mutual fund categories.
- 03Gold prices rose by 63%, reaching nearly ₹1.5 lakh by March 31, 2026.
- 04In contrast, debt and equity funds saw declines of 84% and 17%, respectively.
- 05The highest quarterly inflow for gold ETFs occurred in Q4 FY26, totaling ₹31,561 crore.
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In FY26, gold exchange-traded funds (ETFs) experienced unprecedented net inflows of ₹68,867 crore (approximately $8.3 billion USD), a staggering 364% increase compared to the previous fiscal year. This growth lifted gold ETFs' share of overall mutual fund inflows to nearly 10%, significantly surpassing the historical range of 1-3%. The surge in inflows was primarily driven by rising gold prices, which increased by 63% to nearly ₹1.5 lakh per 10 grams by March 31, 2026, amid heightened global geopolitical tensions. In contrast, traditional equity and debt funds faced significant declines, with inflows dropping 84% and 17%, respectively. The volatility in the stock market, highlighted by a 5% decline in the BSE Sensex over the fiscal year, prompted investors to seek safer investments in gold ETFs, particularly in the fourth quarter, which saw the highest quarterly inflow of ₹31,561 crore. Vikram Dhawan, commodities head at Nippon India Mutual Fund, noted that investment and jewelry demand for gold often move in opposite directions during price spikes, further influencing market dynamics.
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The significant inflow into gold ETFs indicates a shift in investor sentiment towards safer assets, which could influence market strategies and investment patterns.
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