New Delhi: Gold has emerged as the best-performing asset of the year, defying expectations and repeatedly scaling new record highs—not just in India, but across global markets. Investors waiting for prices to cool off have been left surprised, as every dip has been followed by an even sharper rise.
In Delhi, 24-carat gold closed at an all-time high of ₹1,42,300 per 10 grams (inclusive of taxes) on Friday, December 26, 2025. Over the past year, gold prices in India have surged by more than 80%, making it one of the fastest rallies in decades.
A Historic Rally
To put the rise into perspective, gold was trading at ₹78,950 per 10 grams on December 31, 2024. In less than a year, prices have jumped by ₹63,350, marking an extraordinary 80.24% increase.
The rally is equally dramatic in international markets. On December 26, gold climbed $50.87 (1.2%) in a single session to close at a record $4,530.42 per ounce, its highest level ever.
Why Is Gold Rising So Fast?
Analysts point to a combination of powerful global factors driving the surge:
- Expectations of interest rate cuts by the US Federal Reserve in 2026 have boosted demand for gold, which becomes more attractive when bond yields and deposit returns fall.
- Geopolitical and trade tensions worldwide have strengthened gold’s appeal as a safe-haven asset.
- Aggressive buying by global central banks has tightened supply.
- A weaker US dollar has made gold cheaper for non-dollar buyers, further fuelling demand.
With investors expecting at least two rate cuts by the US Fed in 2026, bullion prices have remained firmly supported.
Demand Slows in India
Ironically, while prices are booming, gold consumption in India is declining due to record-high rates. According to the World Gold Council (WGC), India consumed 802.8 tonnes of gold in 2024, but demand in 2025 is expected to fall to 650–700 tonnes.
Between January and September this year, gold sales in India stood at 462.4 tonnes. Despite lower volumes, India’s gold import bill has risen to $55 billion, about 2% higher than last year, driven by higher prices and a weaker rupee.
Consumers Find New Ways to Cope
Gold remains culturally indispensable in India—be it weddings, festivals or religious ceremonies. To manage soaring prices, consumers are changing their buying habits.
According to Sachin Jain, CEO of WGC India, buyers are increasingly shifting away from traditional 22-carat jewellery toward lower-carat options. Nearly 50% of jewellery sold now falls in the 14–18 carat range, compared with much higher purity levels earlier.
Imports Hit Hard
With domestic demand slowing, gold imports have dropped sharply. In November 2025, India is estimated to have imported only 32–40 tonnes of gold, marking a 73% month-on-month decline and a 59% year-on-year fall.
What Lies Ahead?
Gold’s relentless rise underscores its enduring role as a hedge against uncertainty. As long as global economic risks persist, central banks continue buying, and interest rates remain under pressure, analysts believe gold prices are likely to stay elevated.
For investors and consumers alike, the message from 2025 is clear: gold is no longer just a store of value—it has become the defining symbol of global uncertainty.
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