Gold Hits ₹1.10 Lakh/10 g — What’s Fueling the Rally & What’s Next

Gold has recently surged past ₹1,10,000 per 10 grams in India — a record high. The spike is backed by several global and domestic forces, many tied to economic uncertainty and expectations from major central banks. Here’s what’s happening, what experts are projecting, and what you might expect in the coming months.

What’s Driving the Surge

1. Federal Reserve Rate Cut Expectations
   Investors globally are betting that the U.S. Federal Reserve will cut interest rates at its upcoming meeting (mid-September 2025). A softer interest rate environment usually supports gold, because gold doesn’t pay yield — it becomes more attractive when yields on other assets are lower.
2. Weak U.S. Dollar & Lower Yields
   The dollar has eased somewhat, and U.S. Treasury yields have dropped, both of which make gold more appealing. When the dollar weakens, gold is cheaper for overseas buyers, supporting demand.
3. Strong Global & Domestic Demand
   • Central banks continue to accumulate gold.
   • In India, demand is being pulled up by the upcoming festive season, weddings, and jewellery purchases. Jewellery shops are noticing that consumers are still buying despite high prices, though some are switching to old-gold exchange vs fresh purchases.
   • Gold imports in India have hit a 9-month high in August, another sign of strong local buying.
4. Safe Haven & Geopolitical Uncertainty
   Ongoing geopolitical issues and global economic risks — inflation not yet fully under control, concerns about growth — are pushing investors toward gold. The volatile global climate helps gold’s narrative.

What This Means for You (Investor & Buyer Insights)

• If you’re looking to buy jewellery, expect very high price tags now. Many are opting for old-gold exchanges or lighter designs to manage costs.
• As an investor, buying gold on dips might make sense rather than chasing every new high. The momentum is strong, but so are risks of short-term pullbacks.
• Keep an eye on the U.S. Fed decisions, USD strength, and Indian rupee fluctuations — these may swing gold prices significantly.