As Dhanteras approaches, gold remains a staple purchase for Indian households, whether in the form of jewelry, coins, or small tokens. However, this year's buying comes after a tumultuous period for the yellow metal, with prices hitting record highs, plummeting, and then rebounding. Gold surged to nearly $5,600 an ounce in January 2026 before dropping below $4,000, while silver experienced even more dramatic swings, rising above $100 an ounce before falling sharply.
Manav Modi, a commodities analyst at Motilal Oswal Financial Services, noted that gold and silver are facing conflicting global forces. While geopolitical uncertainty boosts demand for precious metals, factors like elevated US Treasury yields and a stronger dollar have weighed on prices. Despite recent declines, global gold ETF holdings hit record highs, indicating sustained investor interest. Silver, though more volatile, could offer bigger gains but with greater risk.
Historically, gold prices tend to rise in the 30 days leading up to Diwali, though this pattern isn't always reliable. The Motilal Oswal report highlighted that gold surged nearly 20% before Diwali in 2025 but fell in the run-up to the festival in 2016 and 2021. Global factors like US interest rates, inflation, and geopolitical tensions play a larger role in shaping gold's long-term value.
For Dhanteras buyers, the key is distinguishing between purchasing gold for sentimental reasons and buying it as an investment. Jewelry, for instance, carries additional costs that may not be recovered when sold. Analysts Navneet Damani and Manav Modi emphasized that while short-term volatility is expected, the long-term case for precious metals remains strong, supported by central bank purchases and global economic uncertainty.