1. Price Surge: Gold on a Record-Breaking Run

• Global gold prices peaked above $3,500 per ounce, marking a 34% increase year-to-date.

• The surge is attributed to inflation concerns, geopolitical instability, central bank buying, and declining faith in bonds and the US dollar.

• Central banks including those in India, China, and Turkey have ramped up gold purchases.

• In India, prices crossed ₹1.02 lakh per 10g, driven by a weakening rupee, import tariffs, and investor expectations of a US rate cut.

• Analysts forecast short-term upside with price targets near ₹1.09–1.10 lakh, with possible spikes depending on global market volatility.

2. Investment Opportunities: “Buy on Dips” Strategies

• Technical indicators suggest continued bullish momentum, making dips an attractive entry point for both long- and short-term investors.

• Moving averages and RSI readings show strength in gold as a safe-haven asset, especially as equity markets remain volatile.

• Analysts continue to recommend “buy on dips,” particularly in the ₹98,000–₹1.02 lakh range for Indian investors.

• With central banks accumulating gold reserves and inflationary fears persisting, long-term demand remains intact.

3. Demand Trends: The Shift from Jewellery to Investments

• Indian gold demand is expected to fall to a five-year low, between 600–700 metric tons, down from 803 tons in 2024.

• Jewellery consumption dropped sharply due to record-high prices and affordability concerns among consumers.

• Meanwhile, investment demand via Gold ETFs and digital gold formats rose. Gold ETF Assets Under Management (AUM) surged by over 25% in key markets.

• In urban centers, investors are shifting from traditional gold jewellery to financial instruments offering liquidity and transparency.

• There is a notable increase in recycling and resale of old jewellery and coins, as people cash in on the elevated prices.

4. Forecast & Market Drivers

• Gold has returned over 26% in USD terms in the first half of 2025 alone, outperforming most other asset classes.

• Indian market participants expect prices to range from ₹96,500 to ₹1.10 lakh per 10g in the remainder of the year.

• Factors driving the market include:

  • Anticipation of central bank rate cuts

  • Currency devaluation, especially in emerging markets

  • Persistent geopolitical risks

• While some minor corrections are expected, the long-term trend remains upward, with projections of $3,900/oz in 2026 and $5,100–5,200/oz by 2030.

5. Historical Perspective: 2020 to 2025

• In early 2020, Indian gold prices were under ₹45,000 per 10g.

• Following the pandemic, gold steadily gained as a safe haven, reaching ₹78,000+ by 2024 and ₹1.02 lakh+ in 2025.

• Factors contributing to this long-term rally include:

  • High inflation

  • Low interest rates in developed economies

  • Decline in equity market sentiment

  • Increasing preference for tangible assets

• These fundamentals have made gold a strategic holding in both retail and institutional portfolios.

6. Indian Market Dynamics: Consumers & Policy Shifts

• India’s love for gold remains strong, but purchasing habits are evolving.

• Digital gold, Sovereign Gold Bonds, and ETFs are gaining popularity among urban and millennial investors.

• Traditional jewellery demand has slowed, especially in rural areas, due to affordability and price volatility.

• The government’s suspension of Sovereign Gold Bond issuances in 2025 has shifted more investor interest toward ETFs.

• Import dependency remains a concern—India imports over 1,000 tons of gold annually.

• Policy tools like import duty revisions and macroprudential regulations aim to manage the impact on trade balance and inflation.

7. Strategic Investment Considerations

For Long-Term Investors:

• Gold continues to offer a hedge against inflation and geopolitical uncertainty.

• Buying in tranches, especially during dips, can yield optimal long-term results.

• ETFs, physical gold, and gold-linked bonds can be used together for diversification.

For Traders:

• Watch support at ₹1.06 lakh and resistance near ₹1.20 lakh.

• Use trend analysis and volume indicators for tactical entries and exits.

For Diversified Portfolios:

• A 5–10% gold allocation is recommended by most financial advisors.

• Gold’s non-correlation with equities makes it an important diversifier.

8. Summary Table: Key Gold Metrics – 2025

9. Conclusion

Gold remains one of the most resilient and profitable assets in 2025. From central banks to retail investors, the metal continues to attract attention as inflation, currency devaluation, and global uncertainty linger.

Indian investors are adapting, shifting from jewellery to financial gold formats. ETFs and digital gold are now mainstream choices. While jewellery may continue to struggle in volume, the overall investment case for gold remains robust.

As we approach the close of 2025, smart investors are looking to accumulate on dips, hedge against systemic risk, and prepare for a potential bull run into 2026 and beyond.