Gold prices reached new record highs across India, exceeding ₹85,000 per 10 grams for the first time, according to the All India Sarafa Association. This unprecedented surge on February 3, 2025, reflects rising demand among jewelers and stockists, driven by market trends and currency fluctuations.
On Monday, the price of 24-carat gold rose by ₹400, pushing it to ₹85,300 per 10 grams, following closely on the heels of the previous record of ₹84,900 several days earlier. Silver also saw substantial gains, rising by ₹300 to ₹96,000 per kilogram. The market momentum suggests growing investment interest amid unpredictable economic conditions.
The report notes significant demand from jewelers as contributing to these increases. Jatin Trivedi, vice president of research at LKP Securities, stated, "Gold prices are surging due to continuous demand from jewelers and stockists, which has intensified the bullish trend." Coupled with the depreciation of the Indian rupee against the US dollar—closing at ₹87.17 on the same day—these factors have catalyzed the hike.
Experts attribute the price fluctuations not just to local demand but also to global market influences. Saumil Gandhi, senior analyst at HDFC Securities, warned, "The fears of another trade war from the USA have significantly bolstered demand for gold as a safe haven asset. This necessitates investor caution and strategic purchasing plans for anyone considering entering the market now."
Regional variations indicate widespread price increases, with Delhi seeing 24-carat gold listed at approximately ₹85,300, and 22-carat gold priced at ₹84,900 per 10 grams. Mumbai and Kolkata reflected similar trends, with marginal variations based on local market conditions. The consistent pattern across these key cities demonstrates the extent of the demand and the tight supply chain post-budget announcements.
This surge is notable following the recent budget presentation wherein finance minister Nirmala Sitharaman proposed slashing import duties on precious metals from 25% to 20%. This move aims to ease market conditions and encourage legal gold purchases over the smuggling alternatives.
Another aspect influencing prices has been the fluctuated international market. Recent trades have seen COMEX gold futures witnessing sharp rises, confirming positive trends globally as investors retreat from equities amid uncertainties. Analyst sentiments convey expectation for continued fluctuations, particularly as more macroeconomic indicators are unveiled this week, including domestic employment data and service indexes which could shift investor sentiment.
Despite the current high prices, analysts predict potential downturns if trends shift based on upcoming economic reports. According to the All India Sarafa Association, the demand appears assured for the immediate future, yet market stability remains contingent upon broader economic health.
This latest increase is part of a five-day consecutive surge, telling of both the unique market conditions and the historical significance for gold pricing. Investors are advised to remain vigilant and make purchases strategically, as fluctuations can turn rapidly based on various internal and external factors affecting the economy.
Looking forward, if proposed tariffs manifest and market pressures increase, gold pricing may continue its upward trend, presenting both risk and opportunity for investors. For potential buyers, the expertise suggests being prepared for higher prices, albeit with the prudent strategy of monitoring these market changes closely.