Gold Prices Fall by 15% Amid Global Economic Uncertainty
Gold has corrected by around 15 per cent from its recent peak after a record-breaking rally spanning nearly two-and-a-half years. The question on everyone's mind is whether this is a buying opportunity or will gold prices fall further.
The reasons supporting the yellow metal's shine include its ability to beat equity returns, provide stability during times of uncertainty, and remain resilient amid strong economic headwinds. Chintan Haria, head of products and strategy at ICICI Prudential Asset Management, notes that gold plays an important role in a portfolio as it is not just an investment for returns but also for protection.
Gold ETFs have seen significant growth, with demand reaching 23.50 tonnes in the first half of 2026, up 163 per cent from the previous year at nine tonnes. However, Vikram Dhawan, head commodities and fund manager at Nippon India Mutual Fund, cautions investors that they should be prepared for sharper two-way price moves.
Despite higher prices, demand for gold is likely to continue due to its cultural significance in India, with Indian households holding an estimated 31,000 tonnes of gold. The World Gold Council's consumer research report found that high prices were encouraging smaller and less frequent jewellery purchases, while exchange offers, savings schemes, and equated monthly instalment (EMI) schemes were helping sustain demand.
Experts believe that from a macro perspective, de-globalisation and geopolitical disruptions are creating new sources of demand for commodities. Rahul Singh, CIO-Equities at Tata Asset Management, notes that gold continues to attract demand from central banks, ETFs, and retail investors.