Can Gold Price Touch ₹1 Lakh in FY26: Rose 32% in FY25

Investment in gold has been remarkable for investors in FY 2024-2025. As per the date available on MCX, Indian spot gold prices rose ~32% in FY25, outperforming the Nifty 50 equity index, which soared just over 5%.

On March 28, 2024, gold prices were around ₹67,000 per 10 grams, but they have since surged to nearly ₹88,700. In the derivatives market, MCX Gold closed 0.05% higher at ₹88,850 per 10 grams on March 28.

In the International market, gold prices are also at an all-time high, backed by the rising demand for safe-haven assets and concerns over the global trade war triggered by U.S. President Donald Trump’s aggressive tariff policies.

Why Gold Prices Increased in FY25?

Over the past years, several factors combined to push gold prices higher, including expectations of interest rate cuts by the U.S. Federal Reserve, strong buying by central banks, fluctuating macroeconomic conditions, and geopolitical uncertainties.

Trump’s tariff policies have heightened fears of a major trade war, which in turn has increased inflation risks and disrupted global growth momentum. These factors have led to a surge in demand for gold, which is seen as a hedge against inflation and uncertainty.

Could Gold Prices Reach ₹1 Lakh in FY26?

The main factors supporting gold prices, such as global uncertainty and central bank purchases, may fuel growth in domestic gold prices, which could reach the ₹1 lakh per 10 grams mark in FY26.

Inflation concerns and the potential for economic slowdown may continue to push investors towards gold as a safe-haven asset. However, many of these factors are already reflected in current gold prices, and fresh catalysts will be needed to push prices to ₹1 lakh.

Without new triggers, gold prices may consolidate at higher levels due to demand fatigue and profit-taking. Furthermore, a rebound in stock markets or the strength of the dollar could pose challenges to gold prices.

Conclusion

While short-term corrections may occur, the long-term outlook for gold remains positive, driven by ongoing global economic uncertainties, inflationary pressures, and central bank policies, which are likely to sustain investor demand for the precious metal in FY26.

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