Topic 5: BULLION: SHIELDED BET

In July 2025, bullion prices—particularly gold—exhibited a consistent upward trend, driven by a combination of strong domestic demand, central bank activity, geopolitical uncertainties, and global economic developments. The price of 24-carat gold in India rose from approximately ₹9,847 per gram at the start of the month to around ₹10,011 per gram by the end, marking a notable increase of about 4%. Similar trends were observed across other gold variants such as 22-carat, 18-carat, and 14-carat, indicating broad-based bullishness in the bullion market. Strong retail and institutional demand played a crucial role in supporting gold prices throughout the month. With ongoing concerns over inflation and market instability, investors increasingly turned to gold as a store of value. This was reflected in steady purchases in both physical and digital gold formats across India. Seasonal and festive buying, coupled with jewellery demand, also added to upward pressure on prices. India’s central bank, along with several emerging market peers, continued its gold-buying spree to diversify foreign exchange reserves and reduce dependency on the US dollar. This strategic accumulation of bullion not only stabilized domestic markets but also lent global support to gold prices. Additionally, a rise in gold imports in India ahead of the festive season created strong physical demand, adding to price momentum. On the global front, gold prices benefited from increased risk aversion among investors. International gold futures saw modest gains, driven by a range of economic and political uncertainties. Notably, the announcement in mid-July of a US base reciprocal tariff hike—from 10% to 15%—on goods from several nations raised concerns about a potential global trade war. This announcement briefly pushed international gold prices above $3,400 per ounce, highlighting bullion’s role as a hedge against rising global uncertainty. Continuing conflicts in the Middle East, particularly the Israel-Gaza situation, along with the prolonged Ukraine war, maintained a high level of geopolitical risk. These tensions contributed to persistent demand for safe-haven assets like gold, keeping its appeal intact even amidst other market developments. In India, the weakening of the rupee against the US dollar further elevated local gold prices. The currency effect, combined with already rising global prices, significantly influenced gold pricing dynamics in the Indian market. Despite a relatively strong US dollar, bolstered by cautious Federal Reserve policy and trade optimism, gold remained resilient. Central banks in developing nations continued their diversification strategies, reinforcing gold’s upward trajectory. Meanwhile, speculative trading around major policy announcements and tariff updates introduced short-term volatility, with prices briefly spiking above $3,400/oz before pulling back later in the month. Bullion prices, particularly gold, rose steadily in July 2025, underpinned by robust domestic and institutional demand, aggressive central bank buying, geopolitical uncertainty, and tariff-related trade concerns. Additional factors such as a weakening rupee, inflationary pressures, and speculative market behaviour also played critical roles. Collectively, these elements reinforced gold’s safe-haven status and ensured it remained a favoured asset class in a turbulent global economic environment.



Top | Back
The information contained herein (the “Information”) may not be reproduced or disseminated in whole or in part without prior written permission from the Company. The information herein is meant only for general reading purposes and the views being expressed only constitute opinions and therefore cannot be considered as guidelines, recommendations or as a professional guide for the readers. The document has been prepared based on publicly available information, internally developed data and other sources believed to be reliable. The directors, employees, affiliates or representatives (“Entities & their affiliates”) do not assume any responsibility for, or warrant the accuracy, completeness, adequacy, reliability and is not responsible for any errors or omissions or for the results obtained from the use of such information. Readers are advised to rely on their own analysis, interpretations & investigations. Certain statements made in this presentation may not be based on historical information or facts and may be forward looking statements including those relating to general business plans and strategy, future financial condition and growth prospects, and future developments in industries and competitive and regulatory environments. Although the Company believes that the expectations reflected in such forward looking statements are reasonable, they do involve several assumptions, risks, and uncertainties. Readers are also advised to seek independent professional advice to arrive at an informed investment decision. Entities & their affiliates including persons involved in the preparation or issuance of this document shall not be liable in any way for direct, indirect, special, incidental, consequential, punitive or exemplary damages, including on account of the lost profits arising from the information contained in this material. Readers alone shall be fully responsible for any decision taken based on this document.
Copyright © 2024 Fintso