A representative image of silver and gold.
Credit; iStock Photo
New Delhi: The record run in gold and silver prices are likely to continue in the coming months due to their sustained demand as safe-haven investments amid global uncertainties, as per the Economic Survey tabled in Parliament by Union Finance Minister Nirmala Sitharaman on Thursday.
On the Multi Commodity Exchange (MCX), gold crossed past Rs 1.8 lakh per 10 gram for the first time while silver set a new record of Rs 4 lakh per kg. The price of yellow metal has doubled in the past one year. It has jumped by around 30% this month.
“The prices of precious metals, both gold and silver, are likely to continue increasing due to their sustained demand as safe-haven investments amid global uncertainties, unless a durable peace is established and trade wars are resolved,” the annual Survey report noted.
“Some commentators feel that the torrid pace set by gold and silver in 2025 may not be sustained,” it added.
Gold price jumped from $2607 per 10 gram at the beginning of 2025 to $4,315 per ounce (10 gram) by the end of 2025 calendar year. It soared past $5600 per ounce on Thursday, while silver jumped above $120 per 10 gram in the international market. Silver price has surged by 74% so far this year.
According to the Economic Survey, the surge in gold price reflects a weakening US dollar, expectations of persistently negative real rates, and the market’s growing assessment of geopolitical and financial tail risks.
However, the Survey noted that other commodity prices would remain soft in the 2026-27 financial year.
According to the World Bank’s Commodity Prices Outlook released in October 2025, global commodity prices are expected to decline by approximately 7% in FY27, primarily driven by subdued crude oil prices amid oversupply.
Geopolitics may come in the way of this prediction, however. On the other hand, the prices of base metals, such as iron, copper, and aluminium, are expected to increase moderately. For instance, in copper, both demand pressures (especially given its usage for green technology and data centres) and supply disruptions might keep its price elevated, the Survey noted.
“Despite the Fed keeping rates unchanged as expected, bullion rallied further after the policy statement highlighted concerns over economic growth, reinforcing uncertainty in global markets. This backdrop, along with persistent geopolitical tensions and ongoing U.S. trade tariff pressures, has strengthened safe-haven flows into gold,” said Jateen Trivedi, VP Research Analyst - Commodity and Currency, LKP Securities.
The surge in prices has hit traditional jewellery demands. Volume of gold jewellery consumption in India fell 430.5 tonnes in 2025, which is 24% lower than the previous year. However, jewellery demand by value was higher by 18% due to the surge in prices.
The Economic Survey noted that a sharp increase in loans against gold jewellery led to the credit growth in 2025.
After moderating earlier in FY26, lending picked up sharply towards the end of 2025. As of December, bank credit was growing at 14.5% year-on-year. Personal loans have led this growth, especially loans against gold jewellery, which have surged due to rising gold prices, it said. Loans against gold jewellery surged by 125.3% year-on-year during that period.