Gold has officially crossed the ₹1 lakh per 10 grams mark in India, sending shockwaves through middle-class households and delighting long-term investors. With the yellow metal now becoming harder to afford, especially for families traditionally reliant on gold as a savings tool, experts say the price rally is unlikely to slow down soon. Driven by global economic shifts, inflation fears, and central bank purchases, gold continues to shine as a safe-haven asset.
The soaring prices have drawn fresh attention to India’s deep-rooted gold-buying culture, with Kotak Mahindra Bank founder Uday Kotak even calling Indian housewives the “smartest fund managers in the world” for their instinctive faith in gold.
Multiple global factors behind price surge
One of the primary reasons behind the gold price spike is the weakening of the US dollar, which boosts the appeal of gold globally. Escalating trade tensions between the US and China have only heightened market uncertainties, prompting investors to seek safety in gold.
Central banks, particularly in Asia, have also ramped up gold purchases to reduce reliance on the dollar and protect against economic instability. According to the World Gold Council, over 1,000 tonnes of gold were bought by global central banks in 2024 alone — one of the highest levels in recorded history.
Economic concerns pushing demand further
Another key factor driving demand is rising concern over stagflation — a mix of slow economic growth and persistent inflation. US Federal Reserve Chair Jerome Powell recently flagged this risk, which makes gold an even more attractive hedge.
Recession fears in the US have also led investors to sell off Treasury bonds, redirecting funds into gold. As interest rates fall and uncertainty grows, experts say gold’s value is likely to remain strong.
Market analysts, including HDFC Securities’ Anuj Gupta, suggest that gold will maintain its bullish trend. Anuj Gupta emphasized that the underlying triggers for this rally are still active, making any price dip a chance to buy. Global investment banks like Goldman Sachs have revised their forecasts, projecting gold could rise as high as $4,500 per ounce in extreme scenarios.
Motilal Oswal’s Navneet Damani and LKP Securities’ Jateen Trivedi echo this sentiment, advising investors to adopt a ‘buy on dips’ approach. With geopolitical instability and inflation continuing to loom large, gold is expected to hold its position as a stable and preferred investment.
