Gold Rates to Fall in Coming Quarters in India

Gold is more than just a metal; it’s an emotion, an investment, a symbol of prosperity. In India, gold holds a special place in our culture, intertwined with traditions, festivals, and financial security. So, it’s no surprise that the question on everyone’s mind is: Will gold rates fall in 2025 in India?

Gold prices are set to reach ₹85,000 per 10 grams in 2025, driven by a mix of central bank buying, geopolitical tensions, and economic uncertainties, according to a report by ICICI Direct. The precious metal has already seen a strong rally in 2024, hitting an all-time high of $2,790 per ounce. With the US Federal Reserve cutting interest rates and persistent fears of a global trade war, gold remains a safe-haven asset for investors.

But will this upward trend continue? Let’s dive into the key factors influencing gold prices and what lies ahead in 2025.

Current Updates on Gold Prices (as of February 2025)

Here are the latest developments influencing gold prices as of February 2025:

Gold Hits ₹85,000 per 10 Grams: Prices have surged, with spot gold expected to rise further towards $2,900-$3,000 per ounce in the coming months.
Central Bank Purchases: Global central banks bought 186 tonnes of gold in Q3CY24, with total annual purchases reaching 694 tonnes. China remains a top buyer, adding 5 tonnes in November 2024.
ETF Flows: Gold ETF inflows remained strong for six consecutive months until October 2024, but saw outflows in November due to a stronger dollar and rising US Treasury yields.
US Federal Reserve Policy: After cutting rates by 100 bps in 2024, the Fed is expected to be cautious in 2025 due to inflation risks tied to Trump’s economic policies.
Rupee Depreciation: On the domestic front, rupee depreciation has contributed to higher gold prices in India, making it even more expensive for local buyers.

Factors Influencing Gold Prices

Several factors are contributing to the anticipated surge in gold prices in 2025:

Central Bank Buying: Global central banks, especially China, have been aggressively purchasing gold to diversify reserves, adding significant demand pressure.
Geopolitical Tensions: Conflicts in the Middle East and Eastern Europe, along with potential trade wars, are pushing investors towards gold as a safe-haven asset.
Monetary Easing: The US Federal Reserve’s decision to cut rates by 100 basis points in 2024 has fueled gold’s rally, with more easing expected in 2025.
Economic Uncertainties: Concerns over global economic slowdowns and US trade policies under Trump have added to gold’s appeal as a store of value.
Inflationary Pressures: Persistent inflation, particularly in the US, is expected to limit the Fed’s ability to cut rates further, supporting higher gold prices.

When to Invest in Gold

If you’re considering investing in gold, here are some key points to keep in mind:

During Economic Uncertainty: Gold performs best when economic conditions are unstable, making it a reliable asset during periods of recession fears or market volatility.
Before Major Geopolitical Events: With geopolitical tensions high in Eastern Europe and the Middle East, investing in gold before further escalations can help safeguard your wealth.
When Interest Rates Are Low: The Federal Reserve’s rate cuts have historically supported gold prices. With rates expected to remain low, now is a good time to consider investing.
Diversify Your Portfolio: Gold is a crucial part of a diversified portfolio, acting as a hedge against inflation and currency fluctuations.
Before Further Price Increases: With prices already on the rise and projections suggesting further growth, early investment can help maximize returns.

Also Read: Will the Gold Rate Decrease in Upcoming Days

Conclusion

Will Gold Prices Fall in Coming Quarters in India 2025?

While gold prices are projected to remain strong in the near term, some factors could potentially slow down the rally in the coming quarters. A strong US dollar, rising US Treasury yields, and possible stabilization in global trade relations might create temporary headwinds for gold. However, with ongoing geopolitical tensions, persistent inflation, and central bank buying, a significant price drop seems unlikely in the immediate future.

For Indian investors, factors like rupee depreciation and domestic demand during festivals will continue to play a role in maintaining high prices. While minor corrections may occur, gold is expected to stay on an upward trajectory throughout 2025, making it a valuable asset for long-term investors.

Download Personal Loan App

Get a loan instantly! Best Personal Loan App for your needs!!

Looking for an instant loan? Buddy Loan helps you get an instant loan from the best-verified lenders. Download the Buddy Loan App from the Play Store or App Store and apply for a loan now!