On Sunday, 9th February 2025, US President Donald Trump announced a new 25% tariff on all aluminium and steel imports into the U.S. Additionally, Trump also announced plans of reciprocal tariffs on many countries, wherein US import duties could increase to match those imposed by the other trading partners for the country. As a consequence, the cost for 10 grams of 24K gold in India has spiked to ₹87,417 on 12th February 2025.
Why are Gold Prices rising?
Interdependent factors like growing economic uncertainties, rising inflation and investor demand are growingly contributing to the sharp rise in gold prices in the following ways:
1. Recent U.S. Tariffs: Apart from raising concerns about global economic stability, Trump’s recent announcement to hike tariffs is expected to increase production costs, leading to higher inflation, affect global markets and trigger a shift in investor sentiment, affecting global markets.
2. Shift To Safe-Haven Assets: To protect their wealth, investors are now tending towards safe-haven assets like gold, since it retains its value even when financial markets are volatile. As fears of inflation and economic slowdown grow, demand for gold has surged, contributing to its rising prices.
3. Central Banks Accumulating Gold Reserves: Another significant factor driving gold prices higher is central banks around the world that are actively increasing their gold reserves. This strategy helps them hedge against risks associated with currency fluctuations and economic crises, further boosting the demand for gold.
The combination of new U.S. tariffs, rising inflation fears, increased demand from investors for safe-haven assets, and central banks accumulating gold reserves has created the perfect environment for gold prices to soar.
Gold Prices in India: A Remarkable 330% Return in the Last Decade
As on 12th February 2025, the cost for 10 grams of 24K gold in India has spiked to ₹87,417. In the last few days itself, the cost for 10 grams of 24K gold in India has increased from ₹86,547 on 7th February 2025 to ₹87,417 on 12th February 2025.
To understand the return one could potentially get from gold, consider this example - if you had invested ₹1 lakh in gold ten years ago, the value for the same today would be a whopping ₹3.3 lakhs.
You can check the live gold rates of 24 karat, 22 karat and 18 karat gold in your city here.
| Quantity | Cost as on 12th February 2025 |
| 10gm 24 Carat Gold price | ₹87,417 |
| 10gm 22 Carat Gold price | ₹80,074 |
| 10gm 18 Carat Gold price | ₹65,533 |
Over the last decade, India has also witnessed a meteoric rise in gold and silver rates collectively. While 10 grams gold in 2013 was priced at ₹29,600, today the same amount has reached ₹86,990 in 2025. Similarly, 10 grams of silver was priced at ₹540 in 2013. The same quantity costs ₹870 today!
| Year | Gold Rates (Rs./10 Gram.) | Silver Rates (Rs./10 Gram.) |
| 2013 | 29,600 | 540 |
| 2014 | 28,007 | 431 |
| 2015 | 26,344 | 378 |
| 2016 | 28,624 | 370 |
| 2017 | 29,668 | 378 |
| 2018 | 31,438 | 414 |
| 2019 | 35,220 | 406 |
| 2020 | 48,651 | 634 |
| 2021 | 48,720 | 626 |
| 2022 | 52,670 | 551 |
| 2023 | 65,330 | 786 |
| 2024 | 79,800 | 980 |
| 2025 | 86,990 | 870 |
| Absolute Return (in the last 10 years) | 230.21% | 130.01% |
Source: Investing.com for 2025 (Data as on 10 Feb 2025)
As per World Gold Council, central banks in India also hold close to 109 metric tonnes of gold as a part of its Gold reserves. In this context, India comes fourth to countries like China (316.01 metric tonnes), Turkey (201.97 metric tonnes) and Poland(187.93 metric tonnes).
Top Gold Stocks To Watch Out for in 2025
As gold prices in India continue to surge, certain companies with direct exposure to the gold ecosystem could benefit significantly. These include businesses involved in gold jewellery, gold financing, and gold exports. Some of the top gold-related stocks that could be positively impacted by a rise in gold prices include:
1. Titan Company: Tanishq by Titan is one of India’s leading jewellery retailers. A rise in gold prices often boosts the perceived value of its inventory, enhancing profit margins. Additionally, strong brand loyalty helps Titan maintain steady demand even during periods of high gold prices.
2. Muthoot Finance: As one of India’s largest gold loan providers, Muthoot Finance directly benefits from rising gold prices. Higher gold valuations increase the loan-to-value (LTV) ratio, allowing the company to lend more against the same quantity of gold.
3. PC Jeweller: PC Jeweller is a leading jewellery retailer in India and is one of the fastest growing jewellery companies in the country. The company’s revenue is up for the last 5 quarters, jumping from ₹43.48 Crores to ₹683.44 Crores, with an average increase of 38.3% per quarter.
Pros and Cons of Investing in Gold at Peak Prices
While gold has historically proven to be a strong investment for wealth preservation, it’s important to consider both its risks and rewards before one considers investing.
Pros of Investing at Peak Prices
- Safe Investment: Gold is considered to be a reliable store of value, especially during times of economic uncertainty. Even at peak prices, gold can help protect wealth from market volatility and inflation.
- Hedge Against Inflation: Gold often performs well when inflation is high, maintaining its purchasing power over time. Investing even at higher prices can help safeguard against the eroding value of money.
- Global Demand: Strong global demand from investors and central banks can continue to drive prices higher, offering potential for further growth even after hitting record highs.
- Portfolio Diversification: Adding gold to your investment portfolio can reduce overall risk, as it often moves inversely to stocks and currencies.
Cons of Investing at Peak Prices
- Limited Short-Term Gains: When you invest at peak prices, there’s a risk that gold prices may correct or stabilize, limiting immediate returns.
- Price Volatility: Although gold is a stable asset in the long term, it can experience short-term price fluctuations, leading to potential losses if the market corrects sharply.
- No Passive Income: Unlike stocks or bonds, gold does not provide dividends or interest. This means your returns rely solely on price appreciation.
- Opportunity Cost: Investing heavily in gold at its peak may result in missing out on higher returns from other asset classes like equities, which could potentially outperform gold in the long run.
Ways to Invest in Gold: Physical Gold, Gold ETFs, Sovereign Gold Bonds and more
The market offers investors multiple convenient ways to invest in gold, including:
1. Physical Gold: Investing in physical gold—such as jewelry, coins, or bars—is the most traditional method. It offers the advantage of tangible ownership, but comes with challenges like storage costs, security concerns, and making charges (especially with jewelry).
2. Gold ETFs (Exchange-Traded Funds): Gold ETFs are financial instruments that allow you to invest in gold without physically holding it. They are traded on stock exchanges just like shares and reflect the current price of gold. Gold ETFs offer high liquidity, low storage costs, and ease of buying or selling anytime during market hours.
3. Sovereign Gold Bonds (SGBs): Issued by the Government of India, Sovereign Gold Bonds (SGBs) are a secure way to invest in gold. They not only track gold prices but also offer an additional fixed interest rate of 2.5% per annum. SGBs come with a lock-in period of 8 years (with early exit options after 5 years), and they are free from storage risks and capital gains tax if held till maturity.
4. Gold Stocks: Another way to gain exposure to gold is through gold mining or refining company stocks. These stocks are influenced by both gold prices and the company’s performance, offering potential for higher returns compared to physical gold. However, they also come with market risks associated with the company’s operations.
Your choice of gold investment should align with your financial goals, risk tolerance, and investment horizon. While physical gold offers emotional and traditional value, options like ETFs, SGBs, and gold stocks provide better liquidity, security, and returns potential without the hassle of physical storage.
Wondering how to invest in Gold in the Stock Market in 2025? Get Started here.
Conclusion
Gold has proven to be a valuable asset, delivering impressive returns of 230.21% over the last decade. Its role as a safe-haven investment, especially during times of economic uncertainty, continues to attract investors. However, with gold prices at record highs, it’s important to weigh the pros and cons of investing at peak levels. Whether you choose physical gold, Gold ETFs, Sovereign Gold Bonds, or gold stocks, each option comes with its own set of benefits and risks. A balanced approach, aligned with your financial goals and risk appetite, can help you make the most of your gold investments. As with any asset, staying informed and diversified is key to long-term success.
Disclaimer
This blog is for general/educational information purposes and is no way to be considered as advice, or recommendation for investment or otherwise.
Investment in securities market are subject to market risk, read all the documents carefully before investing. The securities quoted are exemplary and not to be considered as any kind of advice or recommendation. The past performance of the stocks are not necessarily indicative of future performance. INDmoney Private Limited 616, Level 6, Suncity Success Tower, Sector 65, Gurugram, 122005, SEBI Stock Broking Registration No: INZ000305337, Trading and Clearing Member of NSE (90267, M70042) and BSE, BSE StarMF (6779), SEBI Depository Participant Reg. No. IN-DP-690-2022, Depository Participant ID: CDSL 12095500.
Sources: Investing.com, Investopedia