Key Points
- 24-karat gold in Delhi reached ₹1,35,000 per 10 grams, 22-karat at ₹1,23,760
- Silver prices hit record ₹2,11,100 per kg, up 126% in 2025
- Global gold spot price at $4,325.02 per ounce, silver at $66.04 per ounce
- US Fed Governor Christopher Waller hinted at further rate cuts, weakening dollar
- China’s planned silver export ban from 2026 triggered supply concerns
- Wedding season demand amplifying price impact on consumers
- Experts predict upward trend may continue due to supply shortages
This morning, December 19, Delhi’s bullion market opened with 24-karat gold at ₹1,35,000 per 10 grams, just ₹500 shy of the all-time high recorded in October 2025. The 22-karat variety, preferred for jewelry, stood at ₹1,23,760 per 10 grams. Mumbai’s Zaveri Bazaar mirrored this trend with 24-karat gold trading at ₹1,34,850 per 10 grams, while Chennai recorded ₹1,34,920 and Kolkata ₹1,34,780.
Southern cities showed slightly higher premiums due to transportation costs and local taxes. Bangalore reported ₹1,35,120 for 24-karat gold, Hyderabad at ₹1,35,050, and Kochi at ₹1,34,980. In the west, Ahmedabad saw prices at ₹1,34,900, while Pune matched Mumbai at ₹1,34,850. Jaipur, Lucknow, and Chandigarh in the north hovered around ₹1,34,800-₹1,35,000, creating a uniform price band across the country.
Jewelers across major markets reported thin trading volumes despite the price surge. “Customers are enquiring but postponing purchases, hoping for a correction,” said Ramesh Kothari, a bullion dealer in Mumbai. The wedding season, typically a peak demand period, is seeing delayed buying as families reassess their budgets.
Why Gold Prices Are Surging
The primary driver is turmoil in international markets. Global spot gold crossed $4,325.02 per ounce in early Asian trading, supported by multiple macroeconomic factors. US Federal Reserve Governor Christopher Waller’s dovish comments on December 18 hinted at aggressive rate cuts in 2026, weakening the dollar index by 0.8% to 100.32. A weaker dollar makes gold cheaper for holders of other currencies, boosting demand.
US economic data released on December 18 showed unemployment hitting a four-year high of 5.4%, while manufacturing PMI dropped to 46.8, signaling contraction. These indicators have amplified recession fears, pushing investors toward safe-haven assets. Additionally, geopolitical tensions in Eastern Europe and the Middle East continue to support gold’s appeal as a crisis hedge.
Central bank buying has added another layer of demand. The Reserve Bank of India purchased 15 tonnes of gold in November 2025, bringing its total reserves to 855 tonnes. China and Turkey have also increased their gold reserves by 8% and 12% respectively this year, according to World Gold Council data.
Silver’s Record-Breaking Rally
Silver has outperformed gold, delivering exceptional returns to investors. This Friday morning, silver reached ₹2,11,100 per kilogram in Delhi, marking a 126% gain since January 2025. In international markets, silver remains elevated at $66.04 per ounce, near its 12-year high.
Industrial demand is the primary catalyst. The solar energy sector consumed a record 5,800 tonnes of silver in 2025, up 18% from last year, as India aims to install 100 GW of solar capacity by 2026. Electric vehicle manufacturing consumed another 3,200 tonnes, while electronics and 5G infrastructure development added 2,100 tonnes to total demand.
Supply constraints have exacerbated the price surge. Global silver mining production declined for the fifth consecutive year, falling 4% to 25,000 tonnes in 2025. Recycling rates dropped to a decade-low due to reduced industrial scrap availability. China’s announcement of a silver export ban effective January 1, 2026, has created panic buying. China’s silver reserves are at their lowest level in a decade, prompting the government to prioritize domestic industrial needs.
Silver ETF investments have surged, with holdings in major funds increasing by 35% this year. “Investors are recognizing silver’s dual role as both precious metal and industrial commodity,” noted Anjali Sharma, commodities analyst at HDFC Securities.
Market Expert Predictions and Technical Outlook
Bullion market experts believe the upward trend may continue through the first quarter of 2026. “Gold has strong support at $4,280 per ounce, and a break above $4,350 could trigger momentum toward $4,400,” said Prithviraj Kothari, President of the India Bullion and Jewellers Association. He predicts domestic gold may test ₹1,36,500 by Republic Day 2026.
Silver’s outlook appears even more bullish due to structural supply deficits. “We anticipate silver touching $70 per ounce in the next three months, which translates to ₹2,25,000 per kg domestically,” forecasted Rahul Jain, senior commodities strategist at ICICI Bank. He cites the China export ban and persistent industrial demand as key drivers.
However, some analysts warn of potential corrections. “If the US Fed signals a more hawkish stance in its January meeting, we could see a 3-5% pullback,” cautioned Meera Sanyal, economist at Axis Bank. She advises investors to accumulate on dips rather than chase current levels.
Impact on Consumers and Wedding Season Demand
The price surge is severely impacting household budgets during the peak wedding season. An average Indian wedding requires 80-120 grams of gold jewelry, meaning families now need to spend an additional ₹80,000-₹1,20,000 compared to last year. “We had budgeted ₹10 lakh for jewelry, but now we need ₹11.5 lakh for the same quantity,” lamented Priya Sharma, a Delhi resident planning her daughter’s wedding in January.
Rural demand, which accounts for 60% of India’s gold consumption, has shown resilience despite high prices. Farmers with good monsoon returns are continuing purchases, albeit in smaller quantities. Urban consumers are shifting toward lower-carat jewelry and silver alternatives to manage costs.
Jewelry retailers are offering innovative schemes, including monthly installment plans and gold-saving accounts, to retain customers. Some have introduced 14-karat and 18-karat collections that are 30-40% cheaper than traditional 22-karat jewelry.
Investment Demand and ETF Inflows
Gold Exchange Traded Funds (ETFs) saw net inflows of ₹2,850 crore in November 2025, the highest monthly figure in three years. Sovereign Gold Bonds, issued by the RBI, received subscriptions worth ₹1,650 crore in the December tranche, indicating strong retail investor interest.
Digital gold platforms reported a 45% increase in transaction volumes this month. “Young investors are buying gold in denominations as small as 0.1 grams through apps,” said Vikram Mehta, CEO of a fintech gold platform. This democratization of gold investment is creating a new demand segment that is less price-sensitive.
Future Outlook and Key Factors to Watch
Several events could influence precious metals prices in the coming weeks. The US Federal Reserve’s meeting on January 28-29, 2026, will be crucial. If the Fed cuts rates by 50 basis points as markets expect, gold could rally further. US non-farm payroll data on January 3 will provide clarity on labor market health.
Domestically, the Union Budget 2026, expected in early February, may alter import duties on gold. Currently, gold attracts 12.5% import duty plus 2.5% agriculture infrastructure cess. Any reduction could boost demand but may be fiscally challenging for the government.
Geopolitical developments, particularly in Ukraine and the Taiwan Strait, remain wild cards. Escalation could trigger safe-haven flows, while de-escalation might cause profit-booking.
Historical Context and Year-to-Date Performance
Gold has gained 18.5% in 2025, outperforming the NIFTY 50’s 12% return. This marks the best annual performance since 2020. Silver’s 126% surge is its strongest showing since 2010, when it gained 157% during the post-financial crisis rally.
The gold-silver ratio, which measures how many ounces of silver equal one ounce of gold, has dropped to 65.5, down from 85 at the start of 2025. This indicates silver’s superior performance and suggests industrial demand is driving the market more than precious metal sentiment.
