Gold has become the hottest topic for investors this year. Prices have shot up by an incredible 50% in 2025 alone, crossing Rs 3,55,166 in the international market. Investors are rushing to buy the yellow metal as global uncertainties continue to rise.
This surge follows a 27% jump in 2024 and a 13% rise in 2023. Even after three years of gains, the hunger for gold doesn’t seem to be slowing down.
According to reports, experts say it is hard to tell if prices have reached their peak. Analysts at DSP Mutual Fund were quoted in a media report saying that while the gold bull run may not be over, the comfort zone for new buyers has reduced. “Gold might take a long pause, and only after a meaningful dip will it become attractive again,” the fund was quoted.
Why gold is rising?
The main reasons behind gold’s sharp rise include strong buying by central banks, a weaker US dollar, continued inflows into gold ETFs, and investors looking to protect their money from global tensions. Hopes of an interest rate cut by the US Federal Reserve have also pushed gold higher since lower rates make non-interest-paying assets like gold more appealing.
DSP was quoted in a media report saying that gold is now close to its fair value range of Rs 2,81,113.89 to Rs 3,98,141.09 and has already passed the midpoint of Rs 3,39,627.49. Based on this, the brokerage offered two strategies for investors:
- Hold on: Investors can simply stay invested. In earlier cycles, like in the 1980s, gold traded up to 40% above its fair range. But this comes with higher risk since prices depend more on market sentiment.
- Sell gradually: Investors can consider selling around 5% of their holdings each week to reduce their exposure, especially when prices stay between Rs 3,42,735.19 and Rs 3,55,166.00. DSP was quoted saying that this does not mean the rally is over, but being cautious could protect profits if prices fall sharply.
According to a media report, Ross Maxwell, Global Strategy Lead at VT Markets, also believes gold is currently “overbought,” meaning a short-term correction could happen as traders book profits. However, he sees no major trend reversal.
He was quoted, “As long as gold’s momentum stays strong, the long-term outlook remains positive. While Rs 3,55,166.00 acts as a psychological barrier, investors can still benefit from gold’s safe-haven appeal by using a dollar-cost averaging strategy.”
Also Read: Kerala Man Remains Grounded After Winning Rs. 25 Crore Lottery https://www.vibesofindia.com/kerala-man-remains-grounded-after-winning-rs-25-crore-lottery/
