Gold prices surged to a fresh all-time high on Tuesday, September 30, 2025, as both domestic and global markets witnessed strong buying momentum in the yellow metal. On the Multi Commodity Exchange (MCX), gold futures jumped 1.21% to touch ₹1,16,850 per 10 grams, setting a new record. In international markets, December gold futures also rose 1.14% to $3,899.15 per ounce, the highest level ever recorded.
According to data from the National Stock Exchange (NSE), gold has delivered an impressive 37% return in the past 12 months and is up nearly 31% so far this year. In comparison, the Nifty 50 index slipped 4.65% in the last one year and has managed to rise just 3.66% in 2025. This stark divergence highlights why investors are flocking to gold as a safer asset.
Here are the five major factors driving gold’s record-breaking rally:
A depreciating Indian rupee has made imported gold more expensive, further pushing domestic prices upward. At the same time, demand for gold traditionally spikes during India’s festive and wedding season. With Dussehra and Diwali around the corner, jewelers are witnessing strong orders for both heritage and handcrafted jewelry. Despite record-high prices, cultural and emotional significance continues to drive purchases, ensuring steady demand.
Uncertainty in the United States is also supporting gold prices. Concerns over a possible government shutdown, amid political standoffs between President Donald Trump and the Democrats, have rattled investor sentiment. Market participants are closely watching upcoming economic indicators, including job openings, private payroll data, ISM manufacturing PMI, and Friday’s non-farm payroll report. Any negative surprises could fuel further gains in safe-haven assets like gold.
Ongoing geopolitical conflicts, including the Russia–Ukraine war, the Israel–Hamas crisis, and trade-related disputes involving the US, have created instability across global markets. In such an environment, investors often turn to gold, which is widely considered a safe and reliable store of value. In India too, many buyers are now treating gold less as jewelry and more as a long-term investment, especially amid sluggish stock market performance.
Another strong driver of the gold rally is large-scale central bank buying. To safeguard against currency volatility and the weakening US dollar, many countries across Asia, the Middle East, and Europe have been increasing their gold reserves. The Reserve Bank of India (RBI) has also added to its holdings.
According to the World Gold Council, central banks purchased 20 tonnes of gold in May 2025 alone. Over the past three years, annual central bank demand has consistently exceeded 1,000 tonnes—more than double the average of 400–500 tonnes seen in the previous decade.
Global investors are also pouring money into gold-backed exchange-traded funds (ETFs), which offer exposure to gold without the challenges of physical storage. The world’s largest gold ETF, SPDR Gold Trust, saw its holdings climb 0.60% on Monday to 1,011.73 metric tonnes—the highest since July 2022.
Additionally, expectations of prolonged low interest rates in the US and other developed markets are making non-yielding assets like gold even more attractive. With bond yields falling, gold is increasingly being seen as a hedge against inflation and economic uncertainty.
Experts suggest that if current global and domestic trends continue, gold may move towards the next psychological level of ₹1.25 lakh per 10 grams ahead of Diwali. However, they also caution that such investments should be made carefully, as markets remain volatile.
For now, the yellow metal continues to outshine equities and other traditional assets, cementing its status as a preferred safe-haven investment in times of economic and political turmoil.
