New Delhi,Oct.14,2025:Gold prices in India have recently surpassed ₹1.3 lakh per 10 grams, marking a significant milestone in the precious metals market. This surge has left investors and consumers alike pondering the reasons behind this unprecedented rise and whether the upward trend will continue-
Understanding Gold ETFs
Gold Exchange-Traded Funds (ETFs) are investment instruments that track the price of gold. Each unit of a gold ETF represents a specific quantity of gold, typically one gram. They offer investors a way to invest in gold without the need to physically own it. Gold ETFs are traded on stock exchanges, providing liquidity and ease of access.
Record Inflows into Gold ETFs
In September 2025, gold ETFs witnessed record inflows globally, with a total of $26 billion invested during the quarter. North American investors led the charge, contributing $16.1 billion, while European funds added $8.2 billion. In India, gold ETFs saw inflows of approximately ₹8,363 crore during the same period, a significant increase from previous months.
Central Banks’ Gold Buying Spree
Central banks worldwide have been increasing their gold reserves, contributing to the upward pressure on gold prices. In August 2025, central banks collectively purchased 15 tonnes of gold, with countries like Kazakhstan, Bulgaria, and El Salvador leading the pack. India, China, and Qatar have also been active in expanding their gold reserves.
Factors Influencing Gold Prices
Several factors have contributed to the recent surge in gold prices-
- Geopolitical Tensions: Ongoing conflicts and trade tensions, particularly between the U.S. and China, have driven investors towards safe-haven assets like gold.
- U.S. Federal Reserve Policies: Expectations of interest rate cuts by the U.S. Federal Reserve have weakened the U.S. dollar, making gold more attractive to investors.
- Economic Uncertainty: Global economic uncertainties, including concerns over inflation and recession, have led investors to seek stability in gold investments.
Gold Price Forecasts for 2026
Analysts are bullish on gold’s future prospects. Bank of America has raised its gold price forecast to $5,000 per ounce by 2026, citing strong investment demand and economic uncertainties. Similarly, Goldman Sachs has increased its December 2026 gold price forecast to $4,900 per ounce.
Investment Strategies in Gold
For investors looking to capitalize on the rising gold prices, several options are available-
- Gold ETFs: As discussed, gold ETFs offer a convenient way to invest in gold without the need for physical storage.
- Sovereign Gold Bonds: Issued by the government, these bonds offer a fixed interest rate along with capital appreciation linked to gold prices.
- Gold Mutual Funds: These funds invest in gold mining companies and gold-related assets, providing exposure to the gold sector.
Is Gold Still a Safe Bet
While gold has shown impressive gains, potential investors should consider the associated risks, including market volatility and geopolitical factors. Diversifying one’s investment portfolio and consulting with financial advisors can help mitigate these risks. Given the current economic climate and expert forecasts, gold remains a viable option for those seeking to hedge against uncertainties.
