Surging prices driven by global uncertainty, de-dollarisation, and central bank buying; experts see any dip as short-lived
New Delhi, April 22:
Gold prices in India have soared past the historic ₹1 lakh per 10 grams mark, marking a new milestone in the precious metal’s rally. Market experts, however, caution that such steep upswings typically lead to short-term corrections of up to 10%, though they emphasize that the broader outlook remains firmly bullish.
With persistent global economic uncertainty, including rising geopolitical tensions and concerns over inflation, gold continues to be a preferred safe-haven asset for investors worldwide.
📈 “10% Correction is Natural, But the Rally is Far from Over”
Rajesh Rokde, Chairman of the Gem and Jewellery Council of India (GJC), told ANI that the gold market is following a predictable pattern:
“Whenever there’s a sharp rally, a 10% correction is natural. But such pullbacks are usually temporary. The underlying momentum is intact.”
He attributed the current price spike to two primary global factors:
- De-dollarisation, as countries move away from U.S. dollar dependence
- Increased gold accumulation by central banks, as a hedge against volatility caused by trade wars and economic nationalism
Notably, China’s insurance sector has also ramped up gold investments to mitigate long-term financial risk.
🏦 Central Banks, Trade Wars, and Safe-Haven Appeal Fueling the Surge
According to Rokde, with global gold now trading around $3,400 per ounce, any expected correction could be around $340—but will likely not alter the upward trajectory.
“Even at earlier stages, such as when gold hit $1,000/oz, corrections of $100 were expected and absorbed. Today’s scenario is no different.”
He further emphasized the impact of U.S. tariffs and trade tensions with China, which have triggered fears of recession and boosted gold’s allure.
💬 “Indian Housewife is the Smartest Fund Manager”: Uday Kotak
Adding to the gold sentiment, Uday Kotak, founder of Kotak Mahindra Bank, praised Indian households’ long-standing faith in gold as an asset.
In a social media post, he wrote:
“The Indian housewife is the smartest fund manager in the world. While global institutions print and spend, India has always understood the value of holding gold.”
He urged policymakers to learn from India’s consistent reliance on gold as a store of value.
📊 Outlook: Gold’s Bullish Sentiment Remains
While market watchers anticipate intermittent dips as part of regular price cycles, the macroeconomic fundamentals driving gold remain strong:
- Rising geopolitical instability
- Currency devaluation and inflation fears
- Institutional and sovereign gold accumulation
Experts say these tailwinds make any correction a buying opportunity, especially as Goldman Sachs has forecasted gold to touch $4,000 per ounce in the near future.
As the world braces for more economic crosswinds, gold remains the one shining constant in uncertain times.