As expected, gold ETFs (exchange-traded funds) logged a whopping 106% jump in fund inflows at Rs 24,040 crore in January 2026, buoyed by strong demand for the yellow metal in both the physical and paper forms. In the previous month of December 2025, gold ETFs witnessed Rs 11,646.74 crore inflows – marking the second straight month of surge in inflows.
The month-on-month surge in gold ETF inflows was even stronger in December 2025. Gold ETFs saw a big 211% rise in inflows in December over the previous month, according to official AMFI data.
The year-on-year growth in gold ETF inflows is much higher than even the December growth. Gold ETFs clocked a massive 540% surge in inflows on a yearly basis in the month of January 2026.
What’s behind unprecedented surge in gold and gold ETFs demand
“The surge suggests gold demand remained exceptionally strong, supported by continued investor preference for safe-haven and diversification exposure,” according to Nehal Meshram, Senior Analyst, Morningstar Investment Research India.
Physical gold prices have surged by 90% to 100% in the last 1 year (January 2025 to 31st January 2026). The prices hit an all-time high of Rs 175,930 per 10 grams (24K gold) on 29 January 2026.
“Part of the strength likely reflects fresh allocations at the start of the year, as investors rebalance portfolios and add hedges after a volatile period across risk assets. Gold ETFs continue to benefit from their positioning as a regulated, liquid, and cost-efficient way to hold gold versus physical formats, making them an easy “add-on” allocation during uncertain macro phases,” adds Meshram.
In terms of total assets held by gold ETFs as of 31 January 2026, total AUM stood at Rs Rs 1,84,276.96 crore, a rise of 44% over December 2025. On a yearly basis, the AUM of gold ETFs has surged by 255% in January 2026 over the same month a year ago.
“The persistence of strong flows also indicates that gold’s role is becoming more structural in Indian portfolios. With investors still mindful of inflation risks, currency volatility, and global geopolitical uncertainty, allocations to gold-linked products have remained steady, and January’s spike reinforces the category’s growing appeal as a portfolio stabilizer,” says Nehal Meshram.
Gold ETFs performance in short and long term
Over the short term, Gold ETFs have shown solid resilience and investor interest. In the last 1 month, returns of around 12.28% reflect renewed safe-haven demand and geopolitical and macroeconomic tensions that lifted bullion prices.
Over the last 3 months, the performance accelerates further with nearly 29.52%.
Stepping back to the medium term, the past 1 year has delivered a remarkable 80.02% return in Gold ETFs — an exceptional outperformance compared with most traditional asset classes.
Over the long term, the 3-year figure of 37.79% captures the broader uptrend that the gold market has experienced. This period has been marked by an unprecedented rally in gold prices.
Gold prices of late have been driven by extraordinary monetary easing, elevated geopolitical risk, and repeated bouts of volatility in equities and bonds.
Taken together, these time-frame returns highlight the appeal of gold ETFs.