Will Gold Prices Touch Rs 1 Lakh After Trump Tariffs? Should You Invest? Explained
Experts believe there are high chances that gold will touch the Rs 1 lakh-mark in 2025 with the anticipation of two rate cuts by Fed this year
The new tariff regime by Donald Trump, which have come into effect from today, could push gold prices in India to a staggering Rs 1 lakh per 10 grammes.
Gold prices have already moved up sharply by Rs 11,983 per 10 grams or 7% in last one month to Rs 91,115 from Rs 85,320 logged on March 2.
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In global market, spot gold surged past $3,132.53 per ounce as on April 2, after hitting an all-time high of $3,148.88 earlier in the day, fueled by concerns over US tariffs and potential economic fallout. US gold futures were 0.4% higher at $3,164.20.
Will Gold Touch Rs 1 Lakh?
Currently, gold is just Rs 9,000 away from touching the Rs 1 lakh mark. Reaching there would require a further increase of about 10% from current levels.
Robust central bank purchases, as well as a combination of geopolitical and economic uncertainty driven by Trump’s tariff plans, are supporting gold, Ryan McIntyre, senior portfolio manager at Sprott Asset Management, told The Feed.
Colin Shah, MD, Kama Jewelry, told The Hindu Businessline, there are high chances that gold will touch the Rs 1-lakh-mark in 2025 with the anticipation of two rate cuts by Fed this year.
Moreover, he said being considered a safe-haven asset class, gold witnesses heightened demand and increased fund flows during the times of economic uncertainty.
Kishore Narne, Director & Head of Commodities at Motilal Oswal Financial Services, told CNBCTV18, that there is “no ceiling" on how high gold prices can go. “It could easily reach $4,000-4,500 per ounce. Whatever number you set, it will come eventually," he said.
Meanwhile, Chintan Mehta, CEO, Abans Financial Services, told Mint, that the ongoing rally in gold is an extension rather than the start of a fresh uptrend.
“We believe this is more of an extended rally rather than the start of a fresh uptrend, and we do not expect prices to reach Rs 1 lakh in 2025. Most bullish factors have already been priced in. With these elements largely accounted for, there may not be enough fresh catalysts to push gold beyond the Rs 1 lakh mark," Mehta said.
How US Tariffs Will Impact Gold Jewellery Industry In India
As of FY24, the US accounted for 30% of India’s total exports in the gold jewellery category. India’s tariffs on gold jewellery imports (20%) are far higher than US import tariffs (5.5-7%). While the US imposes no tariffs on cut and polished diamonds, India levies a 5% import tariff, as per a Hindu Businessline report.
Experts believe the consistent buying of gold by central banks will put upward pressure on prices of the yellow metal.
The weakening of Indian rupee has been one of the major factors for domestic gold prices to spike. And the further depreciation of the currency will support gold prices to hit the Rs 1 lakh mark.
Should We Invest In Gold?
Gold has delivered over 18.64% returns in Q1, making it the second-best quarter after Q3 in 1986. For 2024-25, the return stands at 39.73%.
“Given this momentum, an additional 10-12% gain (Rs 1,00,000 level) in the remaining three quarters of 2025 cannot be ruled out. Gold continues to set new records daily, driven by global economic uncertainty, inflation, central bank policies, geopolitical risks, and rupee depreciation," Rahul Kalantri, VP Commodities at Mehta Equities Ltd, told Mint.
According to a report by CBS News, investors should consider investing in gold now to hedge against inflation. Gold’s most well-known feature can help battle the adverse effects of inflation by maintaining and frequently even rising in price during such periods.
Narne stressed the importance of adopting a long-term approach to gold investment, advising investors to maintain 5-20% of their portfolio in gold and gold-related assets.
With stock markets uncertainty prevalent in the past few weeks, gold, unlike many other assets, has been particularly strong both this year and 2024, making it a valuable asset to invest in as others falter.
Investing in gold may not always make sense, as the timing and supporting reasons should be considered. However, the economic landscape of April 2025 is a unique one, making gold a clearly advantageous investment, as per the CBS News.
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