India’s physically backed gold exchange-traded funds (ETFs) recorded their first net monthly outflow in a year in May, as investors booked profits following a sharp rise in prices triggered by higher import duties, data showed on Thursday.

The outflow could reduce import demand in the world’s second-largest gold consumer, helping narrow the trade deficit and support the rupee, one of Asia’s worst-performing currencies.

Gold ETFs registered net outflows of $61 million, equivalent to 0.4 metric tonnes, in May, reducing total holdings to 116.3 tonnes, data from the World Gold Council showed.

Despite May’s outflow, gold ETFs have attracted net inflows of $3.48 billion so far this year.

On May 13, India raised import duties on gold and silver to 15 per cent from 6 per cent as part of efforts to curb overseas purchases of the precious metals and ease pressure on the country’s foreign exchange reserves.

Following the announcement, domestic gold prices surged to ₹164,497 ($1,717) per 10 grams, their highest level in more than two months.

Published on June 4, 2026