In the last one year alone, the price of gold has increased by 35 to 40 percent and in 2025, gold has become expensive by about 10 thousand rupees.
Mumbai: Gold, which has gone beyond the reach of the common man, will return to its place. Experts claim that gold prices will fall by more than 40 percent in the coming time and gold will again come within the reach of the middle class. Currently, the price of gold in the Indian retail market has crossed Rs 91,000 per 10 grams. In the last one year alone, the price of gold has increased by 35 to 40 percent and in 2025, gold will become expensive by about Rs 10,000.
American analyst firm Morningstar claims that gold prices have reached an all-time high, benefiting investors but weighing on consumers. However, gold prices could see a sharp decline in the next few months. The decline is estimated to be more than 38%. If this happens, it will be a big gain for jewellery buyers, but it could hurt investors. How much lower could the price fall?
Currently, the price of 24-carat gold in the Indian market is around Rs 91,000 per 10 grams and in the global market it is above $3,100 per ounce. According to Morningstar, if there is a decline of about 40%, its price in India could be around Rs 55,000 per 10 grams. Morningstar strategist John Mills believes that gold prices in the global market could fall to $1,820 per ounce, which would be a major decline. What could be the reason for this fall? The recent increase in gold prices is due to economic uncertainty, inflation concerns and geopolitical tensions.
During the trade war that began during the tenure of former US President Donald Trump, investors chose gold as a safe haven asset. Now there are several factors that could bring these prices down. Increasing supply of gold: Gold production has increased significantly. Mining profits reached around $950 per ounce in the second quarter of 2024. Global reserves also increased by 9% to 2,16,265 tonnes, with Australia significantly increasing production and the supply of recycled gold also increasing.
Declining demand: Central banks around the world, which bought 1,045 tonnes of gold last year, may now reduce purchases. A survey by the World Gold Council found that 71% of central banks plan to reduce their gold holdings or maintain them at current levels. Market saturation: Mergers and acquisitions in the gold sector increased by 32% in 2024, indicating a peak in the market. In addition, the increase in gold-based ETFs reflects a pattern seen before previous price corrections.
BofA-Sox claim the price will rise. On one hand, John Mills is claiming that the price of gold will fall sharply, while on the other hand, major financial institutions like BofA and Sox think that the price of gold will remain high. Bank of America estimates that the price of gold could reach $3,500 an ounce in the next two years, while Goldman Sachs estimates that the price of gold could reach $3.300 an ounce by the end of 2025.
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