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India’s Economic Survey 2025-26 has highlighted the key drivers behind gold’s record rally in 2025, including a weakening US dollar, global policy uncertainty and geopolitical risks. Gold prices more than doubled on MCX over the year, though recent corrections were seen.
Economic Survey 2025-26 Flags Global Risks Behind Record Gold Prices
New Delhi: In the Economic Survey 2025-26, India's Chief Economic Advisor, V. Anantha Nageswaran, stated that gold prices will witness a historic surge in 2025. Globally, gold prices rose from $2,607 per ounce to $4,315 per ounce, while by January 26, its price was recorded at $5,101.34 per ounce. According to the survey, the weakness of the US dollar, expectations of negative real interest rates, and geopolitical risks further strengthened gold's position as a safe-haven investment.
The price of gold on the Multi Commodity Exchange (MCX) in India was ₹81,028 per 10 grams on January 30, and rose to ₹175,231 on January 29, 2026, giving investors a return of approximately 116%. However, following the release of the Economic Survey, the price of gold fell by 4.87 percent to ₹1,67,095 on January 30. Major gold ETFs, such as the Axis Gold ETF, Union Gold ETF, and 360 One Gold ETF, also declined by up to 10 percent.
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According to the Economic Survey, tariff announcements by the US government in the first half of 2025 increased uncertainty in global financial markets. This led investors to shift away from the US dollar and toward safe-haven options like gold, providing significant support to gold prices.
The survey stated that many emerging markets are increasing their share of gold in their foreign exchange reserves due to geopolitical tensions and shifts in the global interest rate cycle. India's gold reserves also increased to $117.5 billion by January 2026, up from $78.2 billion in March 2025.
The surge in gold prices has had a direct impact on India's import bill. Gold imports increased by 27.4 percent in FY25, while prices increased by 38.2 percent year-on-year. Furthermore, loans against gold also increased sharply by 125.3 percent.
The Economic Survey estimates that gold and silver may remain in demand as safe-haven investments as long as global uncertainties, trade wars, and geopolitical tensions persist. However, if there is lasting global peace and a resolution of trade disputes, this boom could slow.
