Gold exchange-traded funds (ETFs) in India recorded their biggest-ever monthly inflow in September, driving total assets under management to a record $10 billion as investors turned to the precious metal amid subdued equity market returns.

Rising inflows into gold ETFs are expected to boost gold imports in India, the world’s second-largest consumer, supporting global prices that recently touched record highs. However, the surge in imports could also widen India’s trade deficit and put additional pressure on the rupee.

Traditionally dominated by jewellery, bars, coin, India is witnessing a shift in the investor preference with urban investors increasingly shifting to gold ETFs as the price rally to record highs.

According to data from the World Gold Council (WGC), gold ETFs witnessed inflows of $902 million (7.3 tons) in September, taking their total holdings to a record 77.3 tons.