Gold, Silver ETF inflows overtake equities in January for first time

etf

Combined inflows into gold and silver exchange-traded funds exceeded equity fund inflows in January for the first time, highlighting higher allocations to precious metals, according to data released by the Association of Mutual Funds in India.

Gold and silver ETFs together attracted inflows of Rs 33,500 crore during the month, surpassing equity fund inflows of Rs 24,029 crore. In December, combined inflows into gold and silver ETFs stood at Rs 15,609 crore, compared with Rs 28,055 crore for equity funds. This was the second straight month when equity flows slowed.

Gold ETFs recorded inflows of more than Rs 24,039 crore in January, while silver ETFs saw inflows of Rs 9,463 crore, AMFI data showed. Assets under management for gold ETFs stood at Rs 1.81 lakh crore, while silver ETF assets were at Rs 1.14 lakh crore.

The inflows in gold and silver were recorded despite significant volatility during the month. Analysts attributed the rise to favourable currency movements and increased allocation to safe-haven assets amid weaker domestic equity markets and persistent geopolitical and trade-related risks.

Experts said demand for gold remained firm through the month and the quarter, supported by ongoing trade and policy uncertainties, a weaker dollar, and expectations of lower yields following the US Federal Reserve’s 25-basis-point rate cut in September. Markets are currently pricing in one to two additional rate cuts by the end of the year.

Gold prices touching repeated record highs further supported investor interest. Even as global equity markets remained near historic peaks, allocations to gold increased as investors sought protection against potential market volatility.

While equity inflows moderated month-on-month amid market volatility, overall industry fund flows remained resilient, with assets under management continuing to grow at a strong double-digit pace year-on-year. Improving global cues following recent India–EU and India–US trade developments, along with stable domestic macroeconomic conditions, supported investor sentiment. Analysts said February inflows are expected to show improvement, with steady retail participation continuing to provide stability to markets despite intermittent volatility.

Ankur Punj MD, Business Head, Equirus Wealth said amid volatile market conditions, investors continued to rely on systematic investment plans and systematic transfer plans, with investors from tier-2 and tier-3 cities leading additions in SIPs. Multi-asset allocation funds continued to see growth in assets under management, serving as a hedge during periods of market uncertainty and reflecting the increasing maturity and long-term orientation of retail participation beyond metropolitan centres.

Category-wise, flexi-cap funds led equity inflows at around Rs 7,700 crore, followed by mid-cap and large-and-mid-cap funds with inflows of approximately Rs 3,200 crore each. This trend indicated selective risk-taking rather than broad-based inflows. At the same time, multi-asset allocation funds continued to attract steady investments, underscoring investors’ preference for diversification to manage near-term market volatility.