Rising trade tensions, global uncertainty, and investor anxiety drive gold to historic highs
NEW DELHI (India CSR): Gold—the world’s oldest safe-haven asset—is once again proving its worth as geopolitical tremors shake the global economy. In India, the price of gold surged to Rs 91,115 per 10 grams this week, with many experts predicting that the Rs 1 lakh per 10g milestone is within striking distance.
The primary driver? A bold and sweeping tariff regime introduced by former U.S. President Donald J. Trump, who returned to office earlier this year. His renewed “America First” strategy has reignited fears of a global trade war, pushing investors to flock to the safety of gold.
Here is the Key Facts Table based on the article “Donald J. Trump’s Tariffs Push Gold Toward ₹1 Lakh per 10g in 2025”:
Gold Surge Amid Donald J. Trump’s Tariff Policy
| Topic | Details |
|---|---|
| Current Gold Price in India | Rs 91,115 per 10 grams (as of April 2, 2025) |
| Expected Target Price | Rs 1,00,000 per 10 grams by end of 2025 |
| Price on March 2, 2025 | Rs 85,320 per 10 grams |
| Monthly Price Increase | Rs 11,983 in one month |
| Global Spot Gold High | $3,148.88/oz (briefly touched $3,167) |
| Trump’s Tariff Policy | 10% base tariff on all imports, 20% on EU, 24% on Japan, 54% total on China |
| Impact of Tariffs | Global trade disruption, investor flight to safe-haven assets like gold |
| Key Global Drivers | Geopolitical tension, economic uncertainty, weak U.S. dollar, central bank buying |
| Expert Prediction (Bullish) | Colin Shah, Rahul Kalantari, Kaynat Chainwala – expect gold to touch ₹1L |
| Expert View (Cautious) | Chintan Mehta – calls for fresh triggers to continue the rally |
| Impact on Indian Exports | Indian jewelry exports to U.S. (worth $11B) may decline due to high tariffs |
| Investment Options | Gold ETFs, Gold FoFs, Sovereign Gold Bonds (limited), avoid physical gold |
| Why Gold is Popular Now | Acts as a hedge in times of market stress and currency devaluation |
Trump’s Trade War 2.0: The Trigger Behind the Surge
Donald J. Trump’s administration implemented a 10% base tariff on all imports, along with steep specific tariffs—20% on the EU, 24% on Japan, and a dramatic 54% total duty on Chinese goods after an additional 34% was imposed this week.
These unexpected measures, which went into effect between April 3–9, have rattled global markets. Trump also reintroduced 25% tariffs on automobiles and parts, directly impacting global manufacturing supply chains.
“This sudden tariff escalation by President Trump has widened the trade war and caused massive uncertainty,” said Manav Modi, Senior Analyst at Motilal Oswal Financial Services. “Gold prices hit a record high as investors turned risk-averse.”
Gold’s Global Climb and Indian Price Trajectory
As of April 2, spot gold prices internationally reached $3,148.88 per ounce, briefly touching $3,167, before settling at $3,132.53. U.S. gold futures stood strong at $3,164.20, reflecting steady upward momentum.
In India, gold jumped by ₹11,983 per 10 grams in just one month, up from ₹85,320 on March 2. At the current trajectory, only a 10% price increase is needed to breach the historic ₹1 lakh level—a figure once considered unimaginable.
Why Gold Is the Go-To in Times of Crisis
Gold’s appeal rises in times of geopolitical tension, and Trump’s aggressive tariff policy has introduced significant volatility into global trade.
Ryan McIntyre, Senior Portfolio Manager at Sprott Asset Management, explained:
“What we’re seeing is a convergence of factors: central bank gold accumulation, trade policy shocks, and geopolitical stress—all pointing to a strong case for gold.”
According to market analysts, gold could reach $3,250/oz globally and Rs 1,00,000 per 10g in India by the end of 2025.
Expert Forecasts and Cautionary Notes
Bullish Outlook
- Colin Shah, MD, Kama Jewelry: “With a weakening dollar, rising tariffs, and geopolitical tensions, we expect gold to test ₹1 lakh by the end of this year.”
- Rahul Kalantari, VP – Commodities, Mehta Equities: “A 10-12% rise from current levels is easily possible given the momentum.”
- Kaynat Chainwala, AVP – Commodities, Kotak Securities: “As trade disruptions persist, gold continues to be a top safe-haven asset.”
The Bearish Angle
However, Chintan Mehta, CEO of Abans Financial Services, offers a more cautious view:
“While gold’s rise has been impressive, much of the bullish sentiment may already be priced in. We may need fresh triggers to break the ₹1 lakh barrier.”
Impact on India’s Gems & Jewelry Sector
The rising tariffs and gold prices are expected to hurt India’s jewelry exports, especially to the U.S., which accounts for over $11 billion annually in sales.
“With U.S. tariffs possibly rising to 20% on certain jewelry categories, Indian exporters may struggle,” said Shah.
Additionally, domestic buyers may become more cautious as gold becomes less affordable, potentially slowing demand in rural and wedding-driven markets.
How to Invest in Gold in 2025
Amid rising prices, investors are exploring different ways to gain exposure to gold beyond just physical jewelry.
Gold ETFs (Exchange-Traded Funds)
- Ideal for: Experienced investors with demat accounts
- Benefits: Real-time pricing, low expense ratio
- Drawbacks: Requires demat account, no SIP option
Gold FoFs (Fund of Funds)
- Ideal for: New investors without demat accounts
- Benefits: Allows SIPs, easy entry
- Drawbacks: Slightly higher expenses than ETFs
Physical Gold
- Issues: Storage risk, making charges, no passive income
- Recommendation: Best avoided for long-term investing
You Learn: Uncertainty Is Gold’s Best Friend
As Donald J. Trump’s policies unsettle global trade, investors are reminded of gold’s timeless value. Whether it’s for portfolio stability or capital appreciation, gold is reclaiming its position as the asset of choice in times of fear and flux.
With prices already nearing Rs 91,115, the Rs 1 lakh per 10g threshold is no longer speculative—it’s a realistic target. But as always, invest wisely and diversify your exposure to ride the wave without risking too much.
(India CSR)
