The strong surge in gold and silver prices seen this year can be attributed to a combination of global and domestic factors working together. Heightened global uncertainty—driven by geopolitical tensions, ongoing conflicts, and slowing growth in major economies—has encouraged investors to move toward safer investment options. In such conditions, gold has traditionally served as a refuge, leading to increased demand worldwide.
Another important catalyst has been the growing expectation that the United States may begin cutting interest rates. Once markets began anticipating a shift in the Federal Reserve’s policy stance, gold prices gained momentum, as assets that do not yield interest tend to perform better when borrowing costs fall. This trend has been further supported by the weakening of the US dollar, which has boosted international prices of both gold and silver.
Central banks have also significantly influenced the rally. Several countries, including China, Turkey, and India, have increased their gold reserves as part of a long-term strategy to strengthen financial stability. This sustained institutional buying has reinforced confidence in gold’s long-term prospects. Silver, meanwhile, has benefited from both traditional and modern demand drivers. Beyond its use in jewellery, silver has become increasingly vital for industrial applications, particularly in solar energy, electric vehicles, and battery technologies, contributing to rising demand.
In the Indian market, robust physical buying during the wedding and festive seasons has added further support to prices. Many households continue to view bullion as a reliable store of value, especially during periods of economic uncertainty, leading to higher investment demand.
Continued global uncertainty, expectations of interest rate cuts, a softer dollar, sustained central bank purchases, and strong industrial demand for silver are likely to keep both metals on a bullish path. While short-term volatility cannot be ruled out, the overall outlook for gold and silver remains positive through 2026.
Rajesh Rokde, Chairman GJC says, the performance of bullion in 2025 underscores its role as a strategic asset rather than a speculative one. He emphasized that gold’s rise reflects enduring trust among Indian investors, while silver has evolved into a key metal supporting renewable energy, electric mobility, and sustainable growth—while still retaining its cultural and jewellery significance.
