Gold glitters with 11% surge in 2025, beats equities and bitcoin. Is there extra room for upside?

Gold has continued its sturdy upward momentum in 2025, gaining 11 per cent year-to-date (YTD), outpacing each equities and Bitcoin. Ventura Securities anticipates a continued rally in gold, forecasting a value of USD 3,000 per ounce, with the potential of surpassing USD 3,080 in Q1 2025. In the meantime, the benchmark Nifty has declined over 3 per cent, whereas Bitcoin has posted modest beneficial properties of round 3 per cent up to now this 12 months.

Elements Behind Rally in Gold Costs

In line with Ventura Securities, the dear steel’s energy stems from a number of elements, together with heightened safe-haven demand, ongoing geopolitical tensions, inflation issues, and central financial institution insurance policies. Sturdy purchases from each central banks and retail buyers have additional fueled the rally.

Gold has been setting document highs virtually day by day. After rising 13 per cent in 2023 and 27 per cent in 2024, the rally has continued into 2025 with an 11 per cent improve year-to-date. The gold value right now stands at USD 2,933 per ounce, whereas in India, it has reached ₹86,810 per 10 grams. The value of 22-karat gold per gram is at the moment ₹7,882. Notably, gold hit a document excessive of USD 2,942.70 per ounce on February 11.

Regardless of a powerful greenback and rising bond yields, gold stays resilient. Ventura Securities famous that elevated U.S. commerce tariffs have amplified financial uncertainty, additional driving demand for the safe-haven asset. Hypothesis about potential tariffs on gold has additionally led to a surge in bodily gold purchases throughout London, Switzerland, and Asia in anticipation of potential new levies within the U.S.

Furthermore, gold’s sturdy efficiency has been bolstered by strong central financial institution demand. In 2024, central banks acquired 1,045 tons of gold, marking the third consecutive 12 months of purchases exceeding 1,000 tons. Over the past three years, central banks have accrued extra gold than within the six years earlier than 2022. Ventura Securities highlighted that central banks are increasing gold reserves to counter anticipated fiscal deficits and hedge in opposition to rising inflation dangers.

Challenges to Gold’s Rally

Whereas gold’s outlook stays bullish, Ventura Securities identified that energy in U.S. Treasury yields and a agency greenback might act as headwinds. Federal Reserve Chair Jerome Powell has maintained a cautious stance, signalling no urgency to chop rates of interest. Powell reiterated that U.S. financial coverage had already undergone vital easing, with 100 foundation factors of fee cuts in 2024, bringing charges down from 5.50 per cent to 4.50 per cent.

Larger rates of interest scale back the enchantment of non-yielding property like gold. Moreover, rising inflation within the U.S., partly because of tariffs, might restrict the Fed’s potential to chop charges additional. CPI inflation knowledge for January stood at 3.0 per cent year-on-year, barely up from 2.9 per cent in December. A stronger-than-expected inflation studying might strengthen the U.S. greenback, probably dampening gold’s momentum.

Powell emphasised that financial coverage would stay restrictive if inflation doesn’t transfer sustainably towards the two per cent goal. Nonetheless, he additionally famous that the Fed might ease coverage if the labour market weakens or inflation declines quicker than anticipated.

Technical Outlook

Jateen Trivedi, VP Analysis Analyst – Commodity and Foreign money at LKP Securities, noticed that gold’s rally has been pushed by a weaker greenback index and continued help from U.S. commerce insurance policies. On the MCX, gold rose by ₹475 to ₹86,280, whereas COMEX gold gained USD 18 to commerce at USD 2,935. Market members at the moment are eyeing upcoming U.S. retail gross sales and core retail gross sales knowledge, which might affect gold’s subsequent transfer.

From a technical perspective, gold stays in a bullish pattern, with ₹85,750 serving as a key help stage and ₹87,000 as the following resistance goal. As uncertainties persist within the international economic system, analysts count on gold to stay a favoured asset amongst buyers.

Disclaimer: The views and suggestions made above are these of particular person analysts or broking firms, and never of Mint. We advise buyers to examine with licensed consultants earlier than taking any funding selections.