Will gold hit Rs 1 lakh in 2025? How to invest in different gold assets

Gold prices in India are on the brink of touching a historic high, with many experts predicting the yellow metal could soon cross the Rs 1 lakh per 10-gram mark. This surge in gold prices comes in the wake of the new tariff regime introduced by US President Donald Trump, which went into effect today, sparking global economic uncertainty.

 

Just one month ago, on March 2, gold was priced at Rs 85,320 per 10 grams. But as of April 2, 2025, the price has already risen by a Rs 11,983, now sitting at Rs 91,115. In the global market, gold has been setting records, with the price of spot gold reaching an all-time high of $3,148.88 per ounce, before stabilizing at $3,132.53. US gold futures also rose by 0.4% to $3,164.20, further fueling the upward trajectory of the precious metal.

 

 

The question on everyone's mind is whether gold will continue to climb. Experts suggest that reaching Rs 1 lakh per 10 grams is not just possible—it’s highly likely. Currently, gold is only Rs 9,000 away from this milestone, and with a further 10% increase from current levels, it could easily touch that mark.

 

Why did gold hit a record high?

 

Comex Gold prices soared to an all-time high in the morning session on Wednesday, reaching $3,167 per ounce, as heightened geopolitical uncertainty fueled safe-haven demand. The rally was triggered by US President Trump's announcement of an aggressive reciprocal tariff policy, which exceeded market expectations. The move escalated concerns over a potential global trade war, prompting investors to seek refuge in gold. 

 

According to Ryan McIntyre, senior portfolio manager at Sprott Asset Management, a combination of robust central bank purchases, geopolitical tensions, and economic uncertainty caused by Trump's tariffs are all driving the demand for gold. During times of financial volatility, investors often flock to gold as a safe-haven asset, seeking refuge from the instability of other markets.

 

"Gold hit a record high, as nervous investors rushed towards safe-haven assets after U.S. President Donald Trump announced more aggressive-than-anticipated tariffs against major trading partners, widening the global trade war. President Trump said in his statement that he would impose a 10% baseline tariff on all imports to the U.S. and higher duties on dozens of other countries, including some of the United States' biggest trading partners, taking effect from April 5th; deepening a trade war that has rattled global markets and bewildered U.S. allies. Trump's administration also confirmed that his 25% global car and truck tariffs will take effect as scheduled on April 3 and that duties on automotive parts imports will be launched on May 3. This means, total tariffs as high as 20% on EU and 24% on Japan would take effect on April 9. US tariffs on China, will rise to 54% after trump imposed a further 34% duty on top of 20% levies he placed on Asian nation earlier this year. Meanwhile, U.S. private payrolls increased more than expected in March 155K v/s 84K, increasing market’s confidence in the US labor market. Imposition on China has increased pressure on industrial metals including Silver and Energy segment as well. Amidst the tariff updates, Dollar Index and US 10Y Yield has also slid further," said Manav Modi, Senior Analyst, Commodity Research at Motilal Oswal Financial services Ltd.

 

What will be the impact? 

 

The Gems and Jewelry sector will be the most affected as import tariffs may be up to 20% from the current 0% on loose diamonds and 5.5-7% on gold jewelry. The US is one of India's largest jewelry export markets, accounting for almost 30% of the share. Indian jewelry exports to the US are over $11 billion per year, explained  Colin Shah, MD, Kama Jewelry.

 

"Moving forward, gold prices are set to touch levels of $3,250 by 2025-end, which will be supported by key factorssuch as trade tariffs by Trump, a weak US Dollar, and escalating geopolitical tensions between Russia and Ukraine as well as rising tension in the Middle East," said Shah.

 

Shah believes gold could very well reach Rs 1 lakh per 10 grams by 2025 end. Shah also highlighted gold’s reputation as a safe-haven asset, which tends to see increased demand and fund inflows in times of economic uncertainty. 

Given the current momentum of gold, an additional 10-12% gain towards Rs 1,00,000 level cannot be ruled out," As per Rahul Kalantari, vice president – commodities at Mehta Equities Ltd.

 

"As global trade tensions persist, gold remains a key safe-haven asset, with further price gains likely amid ongoing uncertainty," said Kaynat Chainwala, assistant vice president for commodities research at Kotak Securities Ltd. 

"The immediate reaction in the week leading to the tariff announcements has been as expected , with the bullish undertone behind Gold remaining strong. At the time of writing this piece, gold has touched new record highs of 3172 USD in line with our earlier piece projecting gains continuing. Gold is now trading above the borderlines on a rising channel which typically may be a signal of caution and traders should put tight stop losses as any reversals can be large from here. As long as Gold stays above the trend channels, it will continue to retain momentum. For the near term, traders will discount dollar weakness on the back of uncertainty and US recession fears and therefore pressure on yields which is gold positive. Midterm Bets will be off on this if Gold retraces below 2930 and in the shorter term, 3030," said Sandip Raichura, CEO - Retail Broking and Distribution, Director - PL Broking and Distribution.

 

However, not all analysts are as bullish on gold's immediate future. Chintan Mehta, CEO of Abans Financial Services, cautioned that the current rally may be more of an extension of an existing uptrend rather than the start of a fresh one. According to Mehta, while the bullish factors for gold may already be priced in, it remains unclear whether there will be enough new catalysts to push prices past the Rs 1 lakh mark in 2025.  How to invest in gold?  

• As an investment, gold can play four fundamental roles in a portfolio:
• a diversifier that can mitigate losses in times of market stress
• a source of long-term returns
• a liquid asset with no credit risk that has outperformed fiat currencies
• a means to enhance overall portfolio performance.

 

An analysis by World Gold Council illustrates that adding between 4% and 15% in gold to hypothetical average portfolios over the past decade, depending on the composition and the region, would have increased risk-adjusted returns.  Since Sovereign Gold Bonds are no longer available, Value Research explains how you can still invest in gold. 

Gold ETFs (exchange-traded funds)

 

Gold ETFs are mutual fund schemes that track gold prices and are traded on stock exchanges.

 

Who should opt for ETFs? Investors with an existing demat and trading account.

Benefits: Lower expense ratios and real-time trading.

Drawbacks: They require a demat account, which incurs brokerage fees. Demat accounts do not support systematic investment plans (SIPs) , either. 

Gold FoFs (fund of funds)

 

Gold FoFs invest in gold ETFs, providing an indirect way to gain exposure to gold prices.

 

Who should opt for FoFs? Investors without a demat account or those seeking simplicity.

Benefits: Allows investments through SIPs and is beginner-friendly.

Drawbacks: Slightly higher expense ratios compared to ETFs.

 

Why shouldn't I directly invest in physical gold?

"That's because it has storage and security issues. Unlike gold ETFs, physical gold doesn't offer any interest or dividends.For those seeking simplicity, gold FoFs provide a practical alternative, while gold ETFs cater to cost-conscious investors with demat accounts," said Aakar Rastogi of Value Research.