Gold has hit a new high of $3,900 per ounce, generating headlines and causing confusion for many consumers wondering if now is the right time to buy.
This global price surge is not limited to international markets; in India, gold is trading at around Rs 12,000 per gram, with 22-carat gold exceeding Rs 11,000 per gram. The rising prices have left many to question whether to buy now or wait for a more opportune moment before the festive season.
Why Gold Prices Are Soaring
According to Jigar Trivedi, Senior Research Analyst at Reliance Securities, gold prices have surpassed $3,900 per ounce to reach a record high. The primary driver is a flight to safe-haven assets by investors amid growing concerns over a prolonged US government shutdown.
The shutdown, which was extended after the Senate failed to advance competing funding plans, has delayed key economic reports, including September’s non-farm payrolls data. This has led investors to rely on alternative indicators that suggest a weakening labor market, reinforcing expectations of an imminent interest rate cut.
Markets are now pricing in a high probability of a 25 basis point cut in October and a similar move in December. Even without fresh economic data, traders are closely monitoring remarks from Federal Reserve officials for clues on the US central bank’s policy outlook.
So far this year, gold has surged by almost 50% due to heightened economic and geopolitical uncertainty, expectations of further rate cuts, central bank buying, and ETF inflows. Trivedi predicts that MCX Gold December contracts are likely to advance to Rs. 119,000 per 10 grams.
In India, gold has always been a precious commodity, viewed not just as an asset but also as a protective guard during good and bad times for households. Despite the price increase, consumers continue to buy gold, with many shifting their preferences from traditional gold to white or rose gold. There’s also a changing demand towards buying 18-carat to 20-carat gold. Gold also finds support in other forms, such as Gold ETFs, which have consistently seen increased inflows.
Is It a Good Time to Buy?
For consumers pondering whether to buy, the advice from industry experts is to proceed with confidence but caution.
Avinash Gupta, Vice Chairman of the All India Gem and Jewellery Domestic Council (GJC), says, “We are witnessing a unique moment in the bullion market. Prices are high, yes—but so is the sentiment. Our advice to consumers is simple: don’t panic. If you’re buying for tradition, go ahead with confidence. If you’re buying for investment, consider staggered purchases. Silver, in particular, offers strong upside potential and remains accessible. Above all, ensure you buy from trusted jewellers and insist on hallmarking and transparency. Dhanteras is a celebration of prosperity—let it also be a celebration of smart choices.”
Gupta’s advice provides a clear roadmap for consumers, distinguishing between buying for traditional purposes and for investment. His suggestion to consider staggered purchases for investment-oriented buyers is a prudent strategy to mitigate risk in a volatile market. The mention of silver as an accessible alternative with strong potential also gives consumers another option. Ultimately, the decision to buy gold is a personal one, influenced by both financial considerations and cultural beliefs.
