Economic uncertainty, trade tensions, and central bank buying push gold to new highs. Analysts remain bullish, but warn of profit-booking risks amid stock market rebound.
20 Apr 2025: Gold continues its stellar run in 2025, with prices surging nearly 25% year-to-date on the Multi Commodity Exchange (MCX). The yellow metal has more than doubled in value over the past five years, rising from ₹44,906 per 10 grams in April 2020 to ₹95,239 per 10 grams in April 2025 — a gain of over 110%.
But with soaring returns comes an important question: Can gold touch ₹1 lakh in the short term, or is a correction on the horizon?
What’s Driving the Rally?
According to Anuj Gupta, Head of Commodity & Currency at HDFC Securities, the spike in gold prices is largely attributed to:
- Escalating US-China trade tensions, intensified by tariff hikes under US President Donald Trump.
- Economic uncertainty, with fears of a US slowdown or even recession.
- Increased safe-haven demand amid volatile global markets.
“Even a 1% tariff hike could shave off 0.10% from US GDP, and that’s enough to fuel investor anxiety,” said Gupta.
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Goldman Sachs Ups the Bull Case
Global brokerage Goldman Sachs has now raised its gold price target from $3,300 to $3,700 per troy ounce. In a high-risk scenario, it predicts gold may even hit $4,500/oz, which would push MCX gold to ₹1.25 lakh per 10 grams.
Currently, technical indicators suggest support at ₹91,000 and resistance near ₹99,000, setting the stage for a possible breakout in coming weeks.
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Will There Be a Sharp Fall?
Experts largely dismiss the idea of an imminent crash. “The triggers that pushed gold prices higher still remain intact,” Gupta said. However, a stock market revival could spark short-term profit-booking, especially after such steep gains.
Can Gold Reach ₹1 Lakh Soon?
Navneet Damani, Group Senior VP at Motilal Oswal Financial Services, believes gold has room to grow.
“The outlook remains constructive. Central bank buying, inflation concerns, and unresolved trade conflicts will keep the demand for gold strong,” he noted.
He recommends a ‘buy on dips’ strategy, especially for long-term investors seeking portfolio stability amid geopolitical and economic turbulence.
Investor Strategy
- Short-term target: ₹97,000–₹1,00,000
- Medium-term target: ₹1,25,000 (in extreme bullish case)
- Buy zone: ₹91,000–₹93,000 (on dips)
- Global triggers to watch:
- US-China trade talks
- Federal Reserve’s rate policy
- Inflation data
- Central bank gold purchases
Conclusion:
Gold remains a compelling hedge against uncertainty. As market sentiment swings between optimism and caution, investors should stay alert to global developments while holding gold as a long-term safe-haven asset.
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