In a gold strategy note, MOFSL highlighted that gold prices in India surged from about ₹30,000 per 10 grams in 2019 to over ₹1 lakh in mid-2025, delivering gains of more than 200% over six years. The firm said it adopted a bullish stance early, raising price targets steadily through regular quarterly and annual updates — all of which surpassed projections.
Last year alone, MOFSL’s reports anticipated levels near ₹98,000 per 10 grams, which nearly matched its stated target of ₹1.02 lakh per 10 grams.
However, the firm now sees multiple signs that the rally may be due for a breather. “We need to wait for more clarity or a decisive trigger, so a period of consolidation may be appropriate,” said Manav Modi, Analyst, Precious Metal Research, MOFSL.
The report listed key reasons for the cautious tone:
- The risk premium from geopolitical tensions — such as conflicts involving Israel-Iran and Russia-Ukraine — is already reflected in prices.
- Trade-related uncertainties are easing as tariff disputes settle.
- Expectations of interest rate cuts are delayed, removing another short-term boost.
- Central bank gold buying continues but at a slower pace.
- The dollar index is falling quickly while de-dollarisation trends grow, but these factors are already accounted for.
- Expected USD-INR moves could still influence domestic prices.
- Signs of market fatigue are visible at these high levels.
MOFSL pointed out that Comex gold has historically never gained more than 32% in a year in the past 25 years, while this rally has delivered gains exceeding 30% already.
Tactical traders holding long positions were advised to watch key levels. “Hedging or exiting on a sustained close below ₹96,000 per 10 grams may be appropriate,” the note said.
If new, longer-term triggers emerge, MOFSL said it would consider re-entering to continue the gold story. For now, it expects price moves to remain range-bound until a clear catalyst emerges.
First Published: Jul 21, 2025 4:15 PM IST
