Gold prices on the Multi Commodity Exchange rose sharply to cross Rs 1,62,000 per 10 grams for the first time ever in May 2026, driven by a combination of global safe-haven demand, a weakening US dollar index and geopolitical tensions in Eastern Europe and the Middle East. The rally was also supported by continued central bank gold buying globally, with central banks collectively purchasing over 1,000 tonnes of gold in 2025 for the third consecutive year.
Domestic demand also played a significant role, with jewellers and institutional investors increasing their positions ahead of the summer wedding season. India's gold imports rose 18% year-on-year in April, reflecting strong underlying demand. The India Gold Council noted that retail investors are increasingly treating gold as a portfolio diversifier rather than just a cultural asset, with gold ETF and digital gold purchases growing rapidly.
Analysts expect prices to test Rs 1,65,000 in the near term if the dollar index continues its downward trajectory. Comex gold futures surpassed $3,200 per troy ounce, a key milestone for global gold markets. Investors are advised to use dips as buying opportunities while maintaining strict stop-losses below Rs 1,55,000 on MCX, given the sharp run-up in prices which may invite profit-booking at higher levels.
