Gold price Hike: Gold prices in India have seen big jumps, with an increase of Rs 9,506 in the past seven weeks alone. The price increase is not confined to Indian markets; instead, prices are shooting up internationally. On Friday, gold recorded its seventh consecutive week of gains in India and eighth in global markets.
This steady ascent is on account of many factors, including the uncertainty of the global economy, geopolitical tensions, and fears of a trade war. As demands for gold increase, experts predict that the price of gold may soon breach the Rs 90,000 level.
Gold Prices in India: Sevens Weeks on the Run
The increase in gold prices at MCX in India during the last seven weeks is Rs 9,506. Seven weeks ago, gold was priced at Rs 76,544 for 10g but now has risen to Rs 86,020 for 10g. In just this week, there has been an increase of 1.57% in the price of gold; indicating strong demand for this precious metal.
Key Factors Causing a Rise in Gold Price
US Tariff Imposition
Tariffs imposed by the US recently created volatility on the global floor. The US imposed a 25% tariff on aluminum and steel, which raised fears of a potential trade war. The uncertainty thus engendered led investors to resort to gold as a safe-haven asset, thereby increasing the demand and price of gold.
Weak US Dollar Index
The depreciation of the dollar has also been conducive to rising gold prices. As the dollar depreciates, investors are increasingly seeing gold as the most elementary form of wealth preservation, which in turn increases the attractiveness of gold in domestic and global markets.
Increased Investments by Banks and Funds
In light of the global economic uncertainties, funds and banks have diverted their assets toward gold. This has been crucial for the ongoing rise of gold prices. The other factor instigating demand for gold is the tariff disputes between the US and Europe, both of which bring direct effects on the real economy on a global scale.
Changes in US-UK Gold Reserves
Due to price differentials on international markets, some large banks such as JP Morgan and HSBC are changing their gold reserve policies. Hence, reports suggest that part of the Bank of England’s gold reserves has been moved to New York, enhancing supply in the US market.
Gold and Silver Prices in India Today
The MCX is closed on a Saturday, but retail jewelry stores remain open. On 22 February 2025, 22-carat gold in Mumbai was priced at Rs 80,240 per 10 grams and 24-carat gold was sold for Rs 87,740 per 10 grams. Meantime, silver was priced above Rs 1 lakh, at Rs 1,00,300 per kg.
Factors Influencing Gold Prices in India
- International Market Rates: International gold prices are directly reflected in the Indian market.
- Import Duties and Taxes: It is because gold is imported into India that import duties and taxes put by the government play a big role in gold price determination.
- Currency Exchange Rates: Fluctuations in the exchange rate of the Indian rupee vs dollar affect the gold prices.
The Cultural and Investment Significance of Gold in India
In India, gold is not merely an investment; there are age-old cultural reasons behind gold’s popularity. The demand for gold peaks during wedding and festival seasons, leading to price fluctuations. As a result, investors and traders keep a close track of gold price variations to gain from market movements. This is why gold is one of the dynamic and most sought-after assets.
As gold prices keep going up, all eyes are set on whether they will hit Rs 90,000 very soon. With global uncertainties and growing demand, gold retains its ground among others for investors seeking stability and long-term value.
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