Why Gold Still Rules the World
From ancient
civilizations who revered it as divine, to central banks stockpiling it as
insurance—gold has always had a unique allure. It’s not just a shiny metal.
It’s an emotional hedge, a financial shield, and a timeless asset. With the
world becoming more uncertain, many are asking: Is gold still worth it? Will
its price continue to rise? Or is the glitter fading?
Why Gold Is Set to Shatter Records
Gold is more than a
yellow metal in India—it’s memory, safety, culture, and wealth. In
2025, gold skyrocketed nearly 28%, reaching close to ₹1 lakh per 10
grams—a dramatic surge unseen in years. Yet behind the glitter lies
uncertainty: will it climb higher, crash back, or consolidate?
This article looks into the following:
- Gold
Market
- Gold’s
Historical Role
- Why
gold soared in 2025
- What
analysts predict through 2030
- How
demand—especially in India—has shifted
- Smart
investment vehicles and strategies
- Risks
to watch in the golden storyline
Gold Through the Ages
Gold has survived empires, revolutions, and
recessions. Its journey includes:
- Ancient
Egypt: Gold was seen as the "flesh of the gods."
- Roman
Empire: Used as currency, symbolizing stability.
- Bretton
Woods (1944): Tied the global monetary system to gold.
- 1971:
U.S. ends gold standard—gold starts floating freely.
Despite policy shifts, gold’s symbolic and monetary
value has endured.
How Gold Prices Work: Key Influencers Today
Gold isn’t just about demand and supply. Several macro
factors impact its price:
1. Inflation and Currency Devaluation
When inflation rises or currencies lose value, people
turn to gold. It's perceived as a "real" asset unaffected by printing
presses.
2. Geopolitical Tensions
Wars, sanctions, and political instability make
investors nervous. Gold is seen as a safe haven, driving demand.
3. Central Bank Actions
Governments globally
(especially in Asia) are buying more gold to hedge against USD risk.
4. Interest Rates
Gold has no yield. So when interest rates rise, gold
demand can drop. But during recessionary or uncertain times, gold tends to
regain favor.
5. Dollar Strength
A strong dollar usually weakens gold prices, and vice
versa.
Gold Price Trends: What the Data Tells Us
- 2020-2021:
COVID-19 pushed gold to record highs (~₹56,000/10g in India)
- 2022-2023:
Gold remained resilient, closing around ₹60,000 amid rate hikes
- 2024: Price rallied further due to
inflation fears, geopolitical tension (Russia-Ukraine, Middle East)
As of August 2025, gold hovers between ₹72,000–₹75,000/10g
in India, and around $2,300–$2,400/oz globally.
Gold Price Explosion: What’s Driving the Surge?
Global Safe-Haven Demand
A slump in U.S. equities,
rising tariffs, and geopolitical tensions pushed investors toward gold. In
early August 2025, gold hit $3,400 per ounce after equity
markets fell sharply, signaling renewed hedge demand.
- Industry giants like Goldman Sachs
and UBS have raised forecasts: Goldman sees gold reaching $3,650–$3,950/oz by
end-2025; UBS is eyeing $2,900–$3,200/oz by 2026.
Indian Realities: Prices Near ₹1 Lakh
MCX futures soared
to ₹100,555 per 10 g by July 2025 before a brief dip below
₹98,500 showing investor caution. Analysts flag consolidation in the near‑term
but expect further swings as macro cues evolve.
Decline in Jewellery Demand, Rise in ETFs
As prices rose, jewellery
enthusiasts pulled back. India’s gold demand is projected to hit a five‑year
low in 2025 (600–700 tonnes vs 802.8 tonnes in 2024), driven by
falling jewellery off‑take—even as investment demand rose 7% in Q2.
Why Gold Might Dip: Is the Bull Run Overdone?
Profit Booking & Volatility
Profit‑taking has driven
gold down ~₹309 per 10 g on MCX in a couple of days, fuelling speculation of
further downside. Writers warn global cues and interest rate policies suggest
caution; gold may stay under ₹1 lakh for now
Jewellery Sales Drop Dramatically
Sky‑high prices prompted
many in India to cancel wedding bookings or sell old ornaments instead of
buying fresh—further dampening jewellery demand.
Expert Predictions: How High Could Gold Go?
India: ₹1.10 Lakh by Mid‑2026?
ET and other outlets
suggest gold could breach ₹1.10 lakh per 10 g within a year, driven
by geopolitical uncertainty and global ETF inflows
Global Forecasts
· Goldman
Sachs: $3,650–$3,950/oz by end-2025; if recession intensifies, gold may
hit $3,880/oz.
· UBS:
Maintains an $2,900/oz target for 2026, and sees potential to $3,200
if macro risk persists.
Longer-Term Outlook to 2030
Models suggest average
annual growth of 8% (stable scenario) or up to 15% (bullish) through 2030-putting
24 K gold around ₹1.25–₹1.5 lakh per 10 g by 2028–30 if inflation or
crises hit hard.
Gold in India - Demand Trends & Cultural Pull
Jewellery vs Investment Demand
Despite a downturn in
jewellery purchases in 2025, digital gold and gold ETF inflows surged - especially
among millennials exploring small‑ticket purchases via apps.
Inflation & Currency Volatility
Persistent inflation and
rupee depreciation against the dollar make gold attractive as a hedge-particularly
in India where culture and trust run deep.
Policy & Regulatory Factors
Custom duties and GST
structures impact physical gold prices. After 2024, import duty dropped from
15% to 6%, making physical gold slightly cheaper than before.
Smart Ways to Invest in Gold
Physical Gold (Jewellery & Bars)
Pros: Tangible asset, emotional value, and cultural
relevance
Cons: Making charges, storage risk, illiquid resale, GST on jewellery
Sovereign Gold Bonds (SGBs)
· Issued
by RBI on behalf of Government
· Fixed
interest of 2.5% p.a. over an 8‑year tenure
· Tax‑free
capital gains if held to maturity
· Scheme discontinued
post‑February 2024, but existing bonds remain valid.
Gold ETFs & Digital Gold
· Lower
transaction costs, no GST/making charges
· Fully
liquid, purchase via apps like Paytm or through stock market
· Prime
choice for small investors and diversification
Smart Strategies for Gold Investors
Rule of Thumb: Buy During Dips
Wait for dips under ₹98,000–₹99,000 per 10 g and buy
gradually. Many analysts suggest the momentum may pause before resuming upward.
Diversify Your Gold Basket
Mix physical gold, SGBs (if held), digital gold, and
ETFs. Each provides liquidity, tax treatment, or emotional value in different
ways.
Monitor Macro Cues
· Fed
rate cuts or hold decisions
· Dollar‑INR
swings
· Global
inflation readings
· Seasonal
demand cycles (e.g. festival and wedding seasons)
Evaluate Your Time Horizon
If investing long term (3–5 years), remain weighted to
investment vehicles. Short‑term traders should watch volatility carefully.
Gold Outlook at a Glance
|
Factor |
2025–2026 Outlook |
|
Major Support Drivers |
Inflation Hedge, Investor Safe-Haven Demand, Etfs |
|
Near‑Term Trading Range |
₹98,000–₹101,000 Per 10 G |
|
Year‑End Price Target |
₹1,10,000–₹1,15,000 Per 10 G |
|
Global Forecast |
$3,650–$3,950/Oz (Goldman); $2,900–$3,200 (UBS) |
|
Long‑Term (2030) |
₹1.25–₹1.50 Lakh Per 10 G Potential (Bull Case) |
|
Jewellery Demand |
Weak In 2025; May Rebound Only If Prices Fall |
|
Investment Vehicles |
Sgbs (Legacy), Gold Etfs, Digital Gold Preferred |
|
Primary Risk Factors |
Fed Policy Tighten, Rupee Strength, Duty Hikes |
Risks Ahead: Why Gold May Drop
· Central
bank rate hikes could reduce gold’s appeal vs fixed income
· Fed
policy tightening may strengthen the dollar, pressuring gold upward
· Import
duty changes could impact domestic physical prices
· Weak
jewellery demand continues to drag retail consumption
Gold’s Timeless Allure Still Shines Bright: Is Gold Still a Good Investment?
As we reflect on gold’s
journey—from ancient temples to modern trading floors—it becomes clear that
gold isn’t just a commodity; it’s a cultural constant, a crisis hedge, and a
symbol of wealth that transcends generations. Despite the volatility of global
markets, rising inflation, and digital disruptions like cryptocurrencies, gold
continues to stand tall as a store of value. Whether you're a seasoned
investor, a cautious saver, or someone just intrigued by the shimmer of
precious metals, gold offers something solid—both literally and financially.
The future of gold might
not be paved with explosive overnight gains, but its strength lies in
reliability and resilience. As central banks keep buying, geopolitical tensions
remain high, and economies dance around recession fears, gold will likely remain
a cornerstone in diversified portfolios. The key isn’t to blindly chase gold,
but to understand why it holds value and how it
can work for your goals.
So, whether you're
thinking about buying your first gram or diversifying your assets with ETFs or
sovereign gold bonds, remember: gold isn’t just an investment. It’s a long-term
relationship with history, economy, and peace of mind.
