Gold prices are on a remarkable upward trajectory, with international markets potentially seeing levels reach $4,500 per ounce, according to a report by Motilal Oswal Financial Services Ltd (MOFSL). The rally is supported by continued central bank purchases, geopolitical uncertainties, and strong demand from Asia. In 2025, gold has already surged over 50 per cent, crossing the $4,000 per ounce mark and hitting more than 35 record highs this year. The rise is attributed to global uncertainties, expectations of US Federal Reserve rate cuts, and steady accumulation by central banks. “Gold’s impressive rally is a result of various macroeconomic shifts, including fiscal uncertainties, a weaker dollar, and strategic diversification by central banks. Asia is becoming the focal point of this new monetary alignment,” said Manav Modi, Analyst, Commodities & Currencies at MOFSL, as quoted by PTI.In India, gold recently reached Rs 1.20 lakh per 10 grams and could potentially climb to Rs 1.35 lakh in the long term, assuming a USD-INR exchange rate of 89. The rally is further supported by a weak US dollar index and a relatively strong rupee. Central banks purchased nearly 600 tonnes of gold in the first nine months of 2025, while global gold ETFs saw record inflows of 450 tonnes, the highest since 2020. Meanwhile, Silver has outperformed gold in 2025, gaining over 60 per cent year-to-date, and is expected to reach around $75 per ounce, driven by strong industrial demand and a persistent supply deficit. Domestic silver prices are projected to rise to Rs 2.3 lakh per kilogram. The metal’s rise is being fuelled by industrial applications in solar energy, electric vehicles, and AI hardware. “Central bank diversification is reshaping the bullion market. Institutional demand and sovereign accumulation are now aligned with long-term value creation,” said Navneet Damani, Head of Research, Commodities & Currencies at MOFSL. Ongoing US fiscal concerns and softening labor data have increased demand for safe-haven assets, while supply constraints, including stagnant global mine output, declining ore grades, and stricter environmental regulations, have limited availability. India, one of the world’s largest consumers, imported around 300 tonnes of gold and 3,000 tonnes of silver by September 2025, reflecting steady demand. The gold-silver ratio has narrowed to 81-82 from 110 earlier this year, highlighting silver’s relative strength. MOFSL anticipates strong gold demand in India during the upcoming Diwali festival, supported by cultural preferences and rising disposable incomes. Historically, domestic gold prices have risen in seven of the past ten Diwali seasons. Despite potential short-term corrections, MOFSL maintains a positive long-term outlook for both metals. (Disclaimer: Recommendations and views on asset classes given by experts are their own. These opinions do not represent the views of The Times of India)