Record Gold Prices Prompt Mixed Sentiment Among Investors
With gold prices recently crossing Rs 1 lakh per 10 grams, investors entering Akshaya Tritiya 2025 are facing a dilemma—whether to make a significant gold investment or opt for the traditional token purchase to honour the auspicious occasion. While the sentiment around gold remains strong, experts are urging caution given the current market volatility and rapid price fluctuations seen over the past week.
On April 22, domestic spot gold prices hit an all-time high, breaching the psychological Rs 1 lakh mark. However, as of April 29, prices have corrected significantly, now hovering near Rs 96,000 per 10 grams. This rapid dip has been largely attributed to profit booking and a temporary resurgence in the US dollar, adding to investor indecision.
Highlights:
Gold touched Rs 1 lakh/10g on April 22, then corrected to Rs 96,000 by April 29.
Market volatility causing uncertainty ahead of Akshaya Tritiya gold buying.
Token buying vs. large-scale investment emerging as a key dilemma.
Gold’s Bull Run Continues: Outperformance Against Global Benchmarks
Gold’s long-term performance has been nothing short of stellar. In 2024, gold delivered a 27% return, significantly outperforming benchmarks such as the S&P 500. This momentum has carried into 2025, with gold already posting 26% year-to-date gains, trading above $3,300 per ounce internationally. Analysts note that persistent macroeconomic risks and geopolitical instability continue to bolster gold’s appeal as a safe-haven asset.
According to Chanchal Agarwal, Chief Investment Officer at Credence Equirus Family Office, gold’s bullish trajectory is supported by structural concerns such as rising sovereign debt and unsustainable fiscal deficits, particularly in developed economies. Additionally, central bank demand has intensified, with many countries, including India, ramping up imports due to increasing distrust in foreign custodianship following incidents like the UK’s seizure of Venezuela’s gold reserves.
Highlights:
Gold has outperformed major indices, gaining 26% in early 2025.
Strong central bank demand and distrust in foreign vaults aiding price rise.
Global debt concerns and monetary easing expectations driving long-term sentiment.
Short-Term Corrections Likely, Say Experts
Despite the overall bullish outlook, recent corrections indicate that short-term pullbacks are possible. Experts cite profit-taking and renewed interest in the US dollar as reasons for the latest decline in prices. Going forward, gold’s immediate trajectory will depend heavily on US macroeconomic indicators like inflation and employment data, which will influence the Federal Reserve’s interest rate policy.
According to Satish Dondapati, Fund Manager at Kotak Mahindra Mutual Fund, while some near-term consolidation may persist, the long-term fundamentals remain robust. These include central bank buying, rising geopolitical uncertainty, and a continued push by several nations to reduce reliance on dominant fiat currencies.
Highlights:
Short-term price correction due to profit-taking and stronger dollar.
Near-term movements hinge on Fed policy and US inflation data.
Long-term outlook supported by central bank purchases and geopolitical risks.
Strategy for Akshaya Tritiya: Invest Gradually, Think Long-Term
Investment advisors are recommending a staggered approach to gold buying this Akshaya Tritiya. Rather than chasing highs or basing decisions on emotion, investors are advised to integrate gold purchases into their long-term asset allocation strategy. This approach can help average out price risks and take advantage of any market dips.
Siddharth Srivastava, Head of ETFs at Mirae Asset Investment Managers, stresses that while gold is a powerful diversification tool, investors should avoid impulsive buying driven by festival sentiment. He suggests a measured allocation that factors in portfolio diversification goals and macroeconomic volatility.
Highlights:
Investors should focus on long-term wealth allocation, not short-term gains.
Experts recommend staggered buying to average out costs.
Avoiding emotional investment decisions is crucial amid high volatility.
Sentiment vs Strategy: Emotional Gold Buying Could Be Risky
The cultural importance of Akshaya Tritiya often leads to impulsive buying, especially of physical gold. However, experts caution against overexposure during a period when prices are still elevated. Viral Bhatt, Founder of Money Mantra, advises investors to balance tradition with financial prudence. While symbolic purchases may continue to hold sentimental value, substantial investments should be evaluated through a risk-return lens.
Bhatt also points out that for those who have already gained significantly from past gold holdings, this may be an opportune time to rebalance portfolios and book partial profits. This view is echoed by Raghav Iyengar, CEO of 360 ONE Asset, who recommends using gold ETFs or multi-asset allocation funds to gain exposure to gold without locking into the volatility of physical metal prices.
Highlights:
Emotional buying during festivals may expose investors to price risks.
Experts advise prudent allocation and potential profit-booking.
Gold ETFs and hybrid funds provide more flexible long-term exposure.
