New Delhi: Global investment bank Goldman Sachs has significantly revised its gold price forecast, predicting that gold could touch $4,500 per ounce in the international market by the end of 2025. This represents a 38% jump from the current price of around $3,247 per ounce.
In India, this rally could push gold prices to an unprecedented ₹1.30 lakh per 10 grams, in line with global trends, according to commodity analysts.
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Why Is Gold on the Rise?
The surge in gold prices is being attributed to rising fears of a US-China trade war, a potential global economic slowdown, and increasing financial market instability. Goldman Sachs has now raised its gold price target for the third time this year, previously revising it to $3,300 per ounce.
According to the bank’s report:
- Under normal circumstances, gold could reach $3,700 per ounce by the end of 2025.
- In the event of an escalated trade war, the metal could hit $4,500 per ounce much sooner.
- Gold rose 6.5% last week alone, marking its best weekly gain since the COVID-19 pandemic.
Central Banks and Institutions Fueling Gold Demand
One key driver of this rally is the surging demand from central banks, which are actively increasing their gold reserves to reduce reliance on the US dollar. In addition:
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- The first quarter of 2025 saw the highest inflow into gold-based ETFs since 2020.
- Institutional investors are also turning to gold as a hedge against inflation, recession risks, and rising bond yields.
- Retail investors are seeking safety in gold amid financial market turbulence and economic uncertainty.
Domestic Impact: Gold in India May Touch ₹1.30 Lakh per 10 Grams
Analysts believe that Indian gold prices will follow the global trend. If Goldman Sachs’ projections hold, gold in India could climb to ₹1.30 lakh per 10 grams by the end of the year — a new all-time high.
This rise could have significant implications for the jewellery and investment sectors, as well as for India’s festive and wedding season gold demand.
Diamond and Jewellery Exports Plunge Amid Global Slowdown
While gold shines, India’s diamond and jewellery exports are facing challenges. According to the Gems and Jewellery Export Promotion Council (GJEPC):
- Cut and polished diamond exports fell 16.8% to $13.3 billion in FY 2024-25, marking a 20-year low.
- Overall gems and jewellery exports dropped 11.7% to $28.5 billion, the lowest in nearly four years.
- The decline is attributed to weak demand in major markets like the US and China.
Gold’s Surge a Safe Haven Amidst Global Volatility
As trade tensions escalate and economic risks mount, gold is once again proving to be the go-to safe-haven asset. With central banks and investors alike boosting their exposure, prices are expected to soar — offering both opportunities and challenges for the global and Indian markets.