India's physically backed gold exchange-traded funds (ETFs) saw their largest monthly inflow in September, pushing assets under management to a record $10 billion, as investors flocked to the precious metal amid weak stock market returns.

Higher inflows into ETFs will lift gold imports to the world's second-biggest consumer and are set to support global prices that hit records this week. The surge in imports could widen India's trade deficit and weigh on the weaker rupee, however.

Traditionally dominated by jewellery, coins, and bars, India is now witnessing a shift, with urban investors increasingly turning to gold ETFs as prices rally to record highs.

In September, gold ETFs recorded inflows of $902 million or 7.3 tons to take total holdings to a record 77.3 tons, data from the World

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