By Ishika Sharma
Walk into any jewellery shop in India these days and you’ll likely hear a familiar sigh: “Gold is getting too expensive.” And it’s true. As of mid-2025, gold prices in India have crossed the ₹1,00,000 mark per 10 grams — a historic high that’s made both investors excited and buyers anxious
For a country that buys more gold than almost any other in the world, this surge in prices has triggered widespread conversations — around dinner tables, in markets, and across WhatsApp groups. But what exactly is driving this steep rise in gold prices? And what does it mean for the average Indian
Let’s dive deep into the story behind the spike — because it’s not just about economics. It’s about culture, trust, and how Indians see gold not just as a commodity, but as security, emotion, and tradition.
Gold: More Than Just Metal in India
Before we get into the reasons behind the price hike, it’s important to understand one thing: gold isn’t just an investment in India. It’s part of who we are.
From weddings to religious festivals, from family savings to heirlooms passed down through generations, gold is woven into the Indian way of life. For many Indian households, especially in rural areas, gold is seen as both wealth and security — something that can be easily sold in times of need.
This deep emotional and cultural connection to gold means that any movement in its price is felt widely across the country — not just by traders or investors.
What’s Fueling the Price Hike?
There’s no single reason behind the surge in gold prices. It’s a perfect storm of global and domestic factors that have all come together over the past year:
1. Global Geopolitical Uncertainty
When the world is unstable, gold shines. In 2025, several international events — including tensions in the Middle East, trade disruptions, and economic slowdowns in the West — have made investors nervous.
Uncertainty leads people to look for “safe haven” assets — and gold is the classic choice. As demand rises globally, prices naturally go up.
2. Inflation and Fear of Recession
Across the world, inflation has been rising — and India is no exception. Everyday essentials have become more expensive, and people are feeling the pinch.
Historically, gold is seen as a hedge against inflation. So, when people start fearing that their money will lose value, they tend to buy gold. And with more people buying, prices go up.
3. The Fall of the Rupee
A big reason for the jump in Indian gold prices is the fall in the value of the rupee against the US dollar.
Since India imports most of its gold, any weakness in the rupee means we have to pay more for the same amount of gold. Even if global prices stay steady, Indian prices can rise just because of currency fluctuations.
4. Central Bank Gold Buying
It’s not just individuals — central banks around the world, including the Reserve Bank of India (RBI), have been buying more gold in recent months. This is partly to diversify reserves and protect against global shocks
Institutional buying puts further upward pressure on global prices, which trickles down to Indian consumers too.
5. Digital and Investment Demand
Today, gold isn’t just bought as jewellery. With the rise of digital platforms, more Indians — especially young investors — are buying gold in digital form or through gold ETFs and sovereign bonds.
This increased investment demand, especially in uncertain economic times, is also playing a role in driving up prices.
Impact on Everyday Indians
For many middle-class and lower-income families, the rising price of gold is a real concern. Weddings are getting more expensive. People who used to buy gold regularly during festivals like Dhanteras or Akshaya Tritiya are now thinking twice.
In rural India, where gold is often used as a form of savings (especially for women who may not have access to banks), this price surge can be bittersweet. On one hand, those who already own gold feel wealthier. On the other hand, buying new gold has become harder.
In cities too, people are adjusting — some are switching to lightweight jewellery, others are waiting for prices to stabilize before making big purchases.
Is It a Good Time to Invest in Gold?
That depends on your perspective.
If you’re looking at gold as a short-term investment, it might be risky to buy when prices are at their peak. But if you’re in it for the long haul — for 5, 10, or 20 years — gold still holds its value well and often performs better during economic uncertainty.
Experts usually recommend that gold should make up about 5–10% of your investment portfolio. So even though prices are high, having some exposure to gold can help balance out risks from the stock market or real estate.
And for those who are thinking about buying jewellery, sovereign gold bonds or digital gold might be a better option right now, especially if you’re more focused on returns than tradition.
What the Future Might Look Like
Will gold prices keep rising? Or will they settle down?
No one can say for sure. If global tensions ease, inflation cools, and the rupee stabilizes, prices may dip slightly. But if uncertainty continues — whether due to elections, wars, or economic slowdowns — gold could remain expensive or even rise further.
In the long run, the trend seems to be upward. As economies become more volatile, and as gold continues to be trusted across generations, it’s likely that its value will keep climbing — slowly but steadily.
A Metal With Meaning
Gold, in India, is more than just an asset. It’s a symbol — of prosperity, of celebration, of trust. So when gold prices rise, it’s not just financial news. It touches millions of lives in real, emotional, and practical ways.
Yes, the hike has made things more expensive. But it’s also a reminder of why we’ve always trusted gold — through ups and downs, peace and crisis, tradition and modernity. It may cost more today, but its value — in every sense of the word — is as strong as ever.
