Gold prices in India have been on an upward trend, due to the Global uncertainties, such as geopolitical tensions and trade wars, are making investors nervous. In such times, gold is seen as a safe investment, driving up its demand and price. Additionally, gold is traded in US dollars, so when the dollar weakens, gold becomes cheaper for buyers using other currencies, further boosting its demand. Gold also acts as a hedge against inflation, meaning its value stays stable even when the purchasing power of money declines.Meanwhile

China’s gold purchases have been increased, particularly by the People’s Bank of China (PBoC). In January 2025, the PBoC reported an increase of 5 tons to its gold reserves, bringing the total to 2,285 tons, which constitutes 5.9% of its total foreign reserves.

The Indian rupee’s depreciation against the dollar has made gold imports more expensive, pushing prices higher. Cultural factors also play a role. Festivals like Diwali and wedding seasons see a spike in gold purchases, increasing demand and prices.

Central banks, including the Reserve Bank of India (RBI), are buying gold to strengthen their reserves. This increased buying supports higher gold prices. Additionally, anticipated cuts in US interest rates are making gold more attractive to investors.

When demand for gold exceeds supply, prices naturally rise. Factors like industrial use, jewellery demand, and investment needs are driving this demand.

As of February 26, 2025, gold prices in major cities like Mumbai and Delhi are:

– 24K Gold: ₹88,100 to ₹88,240 per 10 grams

– 22K Gold: ₹80,760 per 10 grams

– 18K Gold: Around ₹66,070 per 10 grams

The Maha Shivratri festival has further fueled demand, causing prices to rise by over 4% in February alone.