Dhanteras, Diwali 2025: Motilal Oswal sees gold rally extending to $4,500 on COMEX, Rs 1.35 lakh in India

Gold’s spectacular ascent in 2025 has redefined the global investment landscape, breaking past the $4,000 mark on COMEX and touching Rs 1,20,000 per 10 grams in India. The metal has delivered over 50% year-to-date gains, notching up more than 35 record highs, as investors worldwide pivot to tangible assets amid global uncertainty. Silver, too, has mirrored gold’s brilliance, surging over 60% YTD, underscoring a broad-based rally in precious metals.

According to Motilal Oswal Financial Services, the rally is being fuelled by a combination of festive resilience, Asia-led structural demand, and a paradigm shift in monetary strategy as central banks diversify reserves. “Gold’s stellar rally reflects a confluence of macro shifts — from fiscal uncertainty and a softer dollar to strategic diversification by central banks. Asia is emerging as the epicenter of this new monetary alignment,” said Manav Modi, Analyst, Commodities & Currencies, Motilal Oswal.

Safe-haven rush

The global macro backdrop continues to favor gold. The U.S. dollar index remains below 100, and markets are pricing in a 70% probability of Federal Reserve rate cuts by year-end. Weak U.S. labor data, coupled with rising fiscal deficits, has driven investors toward safe havens. Political shifts in Japan and China’s push to establish itself as a global gold custodian have further amplified demand.

Domestically, a strong rupee has supported gold prices, while robust festive demand ahead of Diwali has kept physical buying intact despite record valuations. Historically, Indian gold prices have risen in seven of the last ten Diwali seasons, and early signs suggest a repeat this year.

Supply constraints

Gold’s rise is also rooted in supply tightness. Global mine output has stagnated in 2025 due to declining ore grades, environmental curbs, and cost pressures. Meanwhile, demand has surged across Asia and the Middle East, where inflation and currency depreciation have fuelled record buying.

> Global Gold ETF inflows: +450 tonnes (strongest since 2020)
> Central bank purchases: +600 tonnes (Jan–Sep 2025)
> India imports: 300 tonnes of gold and 3,000 tonnes of silver (till Q3 2025)

“Central bank diversification is redefining the bullion market,” said Navneet Damani, Head of Research – Commodities & Currencies, Motilal Oswal. “For the first time, sovereign accumulation and institutional demand are aligned with long-term value creation.”

Silver’s parallel surge

Silver has moved in tandem with gold but for different reasons. Industrial demand from solar energy, EVs, and AI technologies has pushed the metal into a structural deficit for five consecutive years. The gold-silver ratio, which peaked near 110 earlier this year, has now narrowed to 81–82, signaling silver’s growing strength.

Gold prices

Motilal Oswal sees the rally extending further as global uncertainty, slower growth, and diversification trends sustain momentum. While minor corrections may follow, analysts expect gold to trade between $4,250–$4,500 on COMEX and ₹1,28,500–₹1,35,000 in India (assuming USDINR at 89).

Silver, they project, could climb toward $75 on COMEX and ₹2,30,000 domestically.

“We have achieved our target of $4,000 and ₹1,20,000 for gold. Sustained momentum above these highs could extend the rally,” said Modi and Damani. “This isn’t a short-lived surge — it’s gold reclaiming its central role in a shifting global financial order.”