Trump's Tariff Uncertainty Takes 24K, 22K, 18K Gold To New High; Buy Gold In India Before Budget 2025?

Gold prices in India have corrected sharply on Monday, January 27, following the fragile trend in the global market. The latest performance comes after gold prices were at a new all-time high last week, with MCX gold prices crossing Rs 80,050 per 10 grams mark for the first time. The major reason why gold prices have been rallying in January 2025 month so far, is because of uncertainties that loomed around US President Donald Trump's tariff policies that kept the dollar on the edge and made safe-haven assets attractive. Among major events in India will be the upcoming Budget 2025, where revision in customs duty is expected. Ahead of the Budget, gold continues to be seen as a strategic investment asset.

Gold Prices In India:

On January 27th, gold prices were at Rs 82,250 per 10 grams in 24K, down by Rs 170. While 22K and 18K gold prices dipped by Rs 150 and Rs 130 to Rs 75,400 and Rs 61,690 per 10 grams.

Despite the latest fall, gold prices are still up by 5.5% in overall January month so far.

Silver Prices In India:

Silver price also dipped by Rs 1,000 to Rs 96,500 per 1kg. However, silver prices in Chennai, Hyderabad and Kerala continue to be very expensive at Rs 1,04,000 per 1kg. Silver has outperformed gold, with gains of nearly 7% in January so far.

MCX Gold, Silver Price:

After hitting above Rs 80,000 mark, MCX gold price is down by Rs 313 or 0.4% at Rs 79,713 per 10 grams on Monday. During the latest trade, the intraday high for gold is at Rs 79,872 per 10 grams.

MCX silver prices are at Rs 90,565 per 1kg, down by Rs 1,034 or 1.13% after hitting an intraday high of Rs 91,388 per 1kg on January 27th.

Should You Buy Gold Ahead Of Budget?

Prithviraj Kothari, Managing Director of RiddiSiddhi Bullions Limited (RSBL) said, "Following Trump's call for an immediate reduction in US interest rates, gold has reached an all-time high in Indian markets, trading at Rs 80000. It is almost at an all-time high in the international market, trading at around $2780. Trump also stated that tariffs on imports from China, Canada, Mexico, and the European Union could be imposed on February 1st, but nothing is known about his trade policies."

Further, Kothari added, the ECB is predicted to lower interest rates next week, the Fed is projected to keep rates steady, and the BoJ has raised rates today. Furthermore, in 2024, governments, monetary authorities, and central banks remained net gold purchasers. After purchasing a record 1082 tons of gold in 2022, the central banks added 1037 tons in 2024, the second-highest yearly purchase in history. Gold is seen by central banks as a safe and reliable strategic asset.

What Gold Market Is Expecting In Budget 2025?

Colin Shah, MD, Kama Jewelry said, the gems and jewellery industry is one of the key contributors to the economy and a huge employment creator in the country. However, over the past two years, the industry has been facing numerous challenges and needs urgent government intervention. A push must be made to encourage Jewellery manufacturing in India.

He highlighted that the Finance Minister must consider amending the current SEZ Act in order to integrate SEZs into the domestic market appropriately. The upcoming budget should also look at allowing 'reverse job-work', allowing SEZs to utilise their capacities more effectively.

"Hence, when exports are consistently declining, this can prove to be a timely remedy to address the issue. The budget should also consider extending tax exemptions and simplifying the tax structure for SEZ businesses. It should also consider streamlining customs processes for SEZ units, which will make it easier for them to export their goods. The budget should also consider establishing a framework and accordingly adjusting policies to monitor the performance of SEZs," Shah added.