Gold Surges to Record Rs 1.19 Lakh Per 10 Grams as Silver Also Hits Lifetime High
Gold prices in India reached unprecedented levels on Monday, climbing to a record Rs 1.19 lakh per 10 grams, marking a sharp single-day jump of Rs 3,000. Silver mirrored this upward trajectory, touching a lifetime high of Rs 1.48 lakh per kilogram, also gaining Rs 3,000 in a day. The surge is driven by safe-haven demand amid global political uncertainties and growing expectations of additional Federal Reserve rate cuts.
Remarkable Year-on-Year Growth
The precious metal has delivered extraordinary returns over the past year, surging 52% from Rs 78,000 per 10 grams on October 6, 2024. This spectacular rally reflects both global factors and sustained domestic demand during India's festive and wedding season.
With the Goods and Services Tax of 3% applied, Indian consumers now pay Rs 1,22,570 for 10 grams of gold as of Monday. Despite these elevated price levels, retail demand continues to show resilience during the festive period.
Global Factors Driving the Rally
Multiple international developments are contributing to gold's upward momentum:
- US Government Shutdown: Congressional deadlock over federal spending has triggered a partial shutdown, increasing economic uncertainty
- Japanese Political Unrest: Rising nationalist and anti-immigrant sentiments in Japan are causing regional instability
- Fed Rate Cut Expectations: Markets anticipate further monetary easing by the Federal Reserve
- Geopolitical Tensions: Various global flashpoints are prompting investors to seek safe-haven assets
Festive Demand Remains Strong Despite High Prices
Indian consumers continue to purchase gold for traditional and festive occasions, viewing it as both a long-term investment and an essential part of cultural celebrations. Industry leaders report that demand remains robust, driven primarily by upcoming Diwali festivities and the wedding season.
Jewelers note that purchases during this period are occasion-driven rather than discretionary, with customers naturally planning within their budgets while continuing to invest in jewelry for key life moments. Pre-bookings for the festive season have been healthy, supporting an optimistic outlook among retailers.
Shift Toward Lightweight Jewelry
High prices and market volatility are influencing consumer purchasing patterns. Industry data indicates that demand for lightweight jewelry has increased by 20-25% since the last quarter, reflecting consumers' adaptation to elevated price levels.
Additionally, there has been growing interest in lower-karat gold options:
- Demand for 18-karat gold jewelry has grown 10-15%
- Demand for 14-karat gold jewelry has also increased 10-15%
- 22-karat gold continues to be the preferred choice for most traditional buyers
Wedding Season Drives Strong Interest
The festive buying season is in full swing, with particular emphasis on wedding jewelry due to numerous ceremonies scheduled in the final quarter of 2025. This seasonal demand pattern is supporting retail sales despite premium pricing.
Jewelers are proactively pre-booking gold inventory in anticipation of further price increases in the coming weeks, suggesting industry expectations of continued upward pressure on precious metal prices.
Silver Emerges as Alternative Investment
Silver has witnessed remarkable growth, with some industry observers describing it as "the new gold." Tracking inventory movements over the past couple of years reveals a surge of more than 50% in silver demand, as investors seek value in this more affordable precious metal.
Strong investment interest combined with rising consumer demand has propelled silver prices to record levels, making it an increasingly attractive option for those seeking exposure to precious metals at lower absolute price points.
Expert Caution for Retail Investors
While the rally has been impressive, market analysts advise caution for retail investors considering entry at current levels. Following such a substantial surge in gold prices this year, the risk of short-term corrections has increased significantly.
Investment experts recommend against chasing the rally with lump-sum investments at these elevated levels. The rapid appreciation, particularly over the last two to three weeks, suggests the market may be due for a cooling-off period.
Key Considerations for Gold Buyers
Prospective buyers should keep several factors in mind:
- Investment Horizon: Gold remains valuable as a long-term wealth preservation tool rather than a short-term trading opportunity
- Budget Planning: Consider lightweight or lower-karat options if working within tight budgets
- Timing: Avoid making large lump-sum purchases at all-time highs; consider staggered buying if investment is the goal
- Purpose: Distinguish between jewelry purchases for occasions versus pure investment purchases
Market Outlook
The combination of global uncertainty, accommodative monetary policy expectations, and strong domestic seasonal demand suggests continued support for gold prices in the near term. However, the sharp recent gains also increase the possibility of profit-taking and short-term volatility.
Consumers purchasing for festive and wedding occasions may have limited flexibility to time their purchases, but those considering gold primarily as an investment should exercise prudence and avoid overexposure at current elevated levels.
Disclaimer: The views and investment tips expressed in this article are for informational purposes only and do not represent financial advice. The views expressed are those of the sources cited and not necessarily those of this website or its management. Investing in equities or other financial instruments carries the risk of financial loss. Readers must exercise due caution and conduct their own research before making any investment decisions. We are not liable for any losses incurred as a result of decisions made based on this article. Please consult a qualified financial advisor before making any investment.
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