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Synopsis: Gold prices in India have hit record highs in 2025, crossing Rs93,000 per 10 grams, driven by global uncertainty and strong demand. While some experts predict a surge to Rs1 lakh, others warn of possible corrections ahead.
In 2025, gold has consistently dazzled investors, registering over 20 all-time highs. The precious metal has become the centre of global attention amid fears of a looming recession, currency devaluation, and shifting monetary policies by central banks. This growing wave of uncertainty has prompted a worldwide flight to safety, propelling gold prices in India past Rs93,000 for 10 grams of 24-karat gold.
The current gold rally is not just a domestic phenomenon but a global one. Spot gold prices have crossed the $3,200 per ounce mark for the first time ever, while U.S. futures are even higher, at $3,237.50 per ounce. A combination of geopolitical conflicts, notably the situations in Ukraine and the Middle East, and the anticipation of U.S. Federal Reserve rate cuts have intensified demand. Central banks across the world, including those of China and Russia, continue to bolster their gold reserves, further tightening supply.
The momentum has ignited debate within India’s financial and jewellery markets: Will gold touch Rs1 lakh per 10 grams this yearRs
Some industry leaders believe the milestone is within reach. Colin Shah, Managing Director of Kama Jewelry, believes that the expected interest rate cuts by the U.S. Fed in 2025 could push gold beyond the Rs1 lakh mark. He points out that gold, being a traditional safe-haven asset, tends to attract strong capital inflows during uncertain times — a trend that's clearly playing out this year. Echoing this bullish sentiment, Kishore Narne of Motilal Oswal forecasts gold climbing to anywhere between $4,000 and $4,500 per ounce, noting that “whatever number you set, it will come eventually.”
However, this optimism is not universal. Chintan Mehta, CEO of Abans Financial Services, suggests the current rally may be the continuation of an older trend, not the start of a new bull cycle. According to him, most of the bullish triggers — such as rate cut expectations and geopolitical risks — are already priced in. Without fresh catalysts, he believes the Rs1 lakh target may be out of reach this year.
Adding to the cautious perspective, Amit Goel, Chief Global Strategist at Pace 360, warns of a medium-term correction. He expects gold prices to fall back to about $2,600 per ounce over the next six to ten months, with a deeper correction possibly testing levels around $2,400–$2,500. Despite the possibility of a correction, Goel remains positive on gold in the long run, citing strong structural fundamentals. Meanwhile, John Mills of Morningstar presents the most bearish outlook — predicting a steep decline to $1,820 per ounce, due to rising supply, softening demand, and potential saturation in the gold market.
Against this backdrop of volatile forecasts, many investors are grappling with a key question: should they increase their allocation to gold?
Experts urge caution. While gold’s safe-haven appeal is undeniable, its long-term returns have been inconsistent. A historical review of 5-year return cycles reveals that gold has posted returns as low as 1.73% and as high as 17.44%. In comparison, the Nifty 50 index has delivered more consistent results, with 5-year returns ranging from 9.67% to 18.78% over the past two decades. For instance, between 2014–2019, gold managed a mere 1.73% return, while the Nifty delivered 11.60%.
Chethan Shenoy, Director & Head – Product & Research at Anand Rathi Wealth, advises a disciplined allocation strategy. According to him, gold should ideally comprise only 5–10% of an individual’s overall portfolio, with equities taking the lion’s share. He also notes that Indian households already tend to have higher exposure to gold — via jewellery, coins, and bullion — than the global average, which could lead to overconcentration and risk in their investment mix.
Nevertheless, proponents of gold argue that the current global climate — marked by geopolitical flare-ups, the risk of a U.S. recession, and persistent central bank buying — could continue to support high gold prices for the foreseeable future. These factors enhance gold’s attractiveness as a portfolio hedge.
In conclusion, while the possibility of gold touching Rs1 lakh per 10 grams in 2025 cannot be ruled out, the path ahead is fraught with both opportunity and risk. Investors would do well to stay diversified, keeping gold as a hedge rather than a headline act in their portfolios.
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