Market Performance
Gold prices in India have reached an unprecedented milestone, crossing the ₹1 lakh mark per 10 grams for the first time. This surge aligns with the global uptrend, where international gold rates soared past $3,400 per ounce amid a weakening US dollar.
Main News
In Mumbai’s bullion market, the price of 24-karat gold (999 fineness) was recorded at ₹1,00,000 per 10 grams. Simultaneously, 22-karat gold was priced at ₹91,600 per 10 grams. These developments come in the wake of rising global uncertainty following political and economic moves in the United States.
Globally, gold rates have shown a notable climb, with the New York price touching approximately $3,486.85 per troy ounce. This movement is closely tied to market reactions to US President Donald Trump’s announcement regarding a restructuring of the Federal Reserve, which has triggered debates about future monetary policies.
Factors Driving the Surge
Several factors are contributing to the rise in gold prices:
- Geopolitical Uncertainty: Escalating tensions, including concerns around the Russia-Ukraine situation, are prompting investors to seek safety in gold.
- Central Bank Demand: Continued buying from central banks across various nations has bolstered demand.
- Inflation and Currency Trends: Persistent inflation concerns and a declining US dollar are making gold a more appealing asset.
- US Economic Policy: Recent statements and plans from the US administration regarding the Federal Reserve have led to increased volatility in currency markets.
The US Federal Reserve has also expressed concerns that new tariffs could hinder its goals of price stability and full employment. These statements have further fueled the perception of gold as a safe-haven asset during uncertain times.
Company/Market Details: Indian Gold Sector Snapshot
India, ranking as the world’s second-largest gold consumer after China, witnessed a rise in gold demand in 2024:
- Gold Demand (2024): 802.8 tonnes
- Gold Demand (2023): 761 tonnes
- China’s Gold Demand (2024): 985 tonnes
- Total Demand Value (2024): ₹5.15 lakh crore
- Total Demand Value (2023): ₹3.92 lakh crore
The cultural and financial significance of gold in India continues to drive demand. Gold is often pledged for loans during financial hardships, such as medical expenses or educational needs. The increase in gold loans is also facilitated by the growing presence of digital platforms and fintech services, making them accessible in rural and urban areas alike.
Summary
Gold prices have reached historic highs both in India and globally. This increase is attributed to a mix of economic and geopolitical factors, including central bank buying, inflation concerns, and currency depreciation. The developments in the US regarding Federal Reserve policy have further intensified market volatility, making gold a preferred asset for value preservation. In India, the rising demand underscores the enduring role of gold in both cultural practices and personal finance.
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