New Delhi: Gold prices in India hit record highs this week as economic instability and rising geopolitical tensions have driven investors towards the safe-haven asset. On Friday, MCX gold futures for June 5th soared to ₹93,736 per 10 grams, marking an intraday record. At 9:40 AM, gold was trading at ₹93,495 with a gain of 1.59%.
The surge comes amid renewed concerns over macro-level economic uncertainty and the re-escalation of the US-China trade war, reignited by former President Donald Trump’s tariff policy.
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Is Gold on Track to Touch ₹1 Lakh per 10 Grams in 2025?
Industry experts are divided on the future trajectory of gold prices. Some believe the rally could continue, pushing prices past the ₹1 lakh mark per 10 grams in 2025, while others predict a major correction.
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Expert Views Supporting a Bullish Outlook:
- Ryan McIntyre, Senior Portfolio Manager at Sprott Asset Management, attributes the rally to central bank gold purchases and geopolitical tension, particularly tied to Trump’s tariff moves.
- Colin Shah, MD of Kama Jewelry, told The Hindu Businessline that gold is likely to reach ₹1 lakh by 2025, especially if the Federal Reserve implements two rate cuts this year.
- Kishore Narne, Head of Commodities at Motilal Oswal, was even more optimistic, suggesting gold prices could surge to $4,000–$4,500 per ounce, stating, “Whatever number you set, it will come eventually.”
Is the Rally Sustainable? Some Experts Urge Caution
Not all analysts are convinced that gold will continue its meteoric rise.
- Chintan Mehta, CEO of Abans Financial Services, believes the current momentum is an extended rally, not a new uptrend. He suggests most bullish catalysts have already been priced in, making it unlikely for gold to cross ₹1 lakh in 2025.
Bearish Predictions: Could Gold Crash by 40%?
In stark contrast, some experts are sounding the alarm over a potential correction.
- John Mills, Market Strategist at Morningstar, forecasts a sharp drop in gold prices to around $1,820 per ounce—a 38–40% decline from its current level of ~$3,080 per ounce.
- According to Mills, oversupply, reduced demand, and market saturation could trigger a major sell-off in the coming months.
What’s Driving the Volatility in Gold?
Several factors are contributing to gold’s current volatility:
- US-China trade tensions
- Interest rate expectations from the US Fed
- Inflation and recession fears
- Central bank gold reserves
- Investor risk aversion toward equities
Gold continues to act as a hedge against inflation and uncertainty, making it a preferred asset during times of financial distress.