MOHAMMAD ZIYAUDDIN
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Kolkata: After a brief pause following the US Presidential elections in November 2024, gold and silver prices have resumed their northward climb, reaching record levels in March 2025.
According to data from the India Bullion and Jewellers Association (IBJA):
- Silver has crossed the ₹1 lakh/kg mark, a key psychological level.
- Gold is nearing ₹90,000 per 10 grams, setting a new benchmark.
With both metals attracting a 3% tax, their actual market price for buyers is even higher than these figures. This raises a crucial question for investors: Should they sell, buy more, or hold their positions?
Motilal Oswal’s Investment Advice: Buy on Dips
Leading brokerage Motilal Oswal Financial Services remains bullish on gold and silver, recommending investors to buy on dips.
Market View:
While some price consolidation may occur, the overall trend is positive.
Gold prices typically rise when the US dollar weakens—a trend seen after Germany’s recent parliament-approved spending surge, which weakened the USD against the Euro.
Key Drivers Behind Gold’s Rally
Weaker US Dollar:
- The US dollar softened after Germany’s economic measures, making gold a more attractive investment.
Trade Tensions & Safe Haven Demand:
- US President Donald Trump’s tariff retaliation has intensified global trade uncertainty, boosting gold’s appeal as a safe-haven asset.
US Inflation & Federal Reserve Policy:
- February’s cooling US inflation has sparked speculation that the Federal Reserve may cut interest rates, further driving gold prices upward.
Central Bank Buying Spree:
- Major central banks worldwide have been actively accumulating gold, signaling continued demand and price appreciation.
China’s Market Recovery:
- As China’s economy rebounds, increased gold buying from the world's second-largest economy could further fuel price growth.
What Should Investors Do?
Analysts predict gold and silver prices will remain strong through 2025, making "buy on dips" a favored strategy for long-term investors.
With global economic uncertainty, central bank interest, and safe-haven demand, gold and silver may continue their bullish run, offering investors opportunities to capitalize on market fluctuations.
