Topic 5: BULLION: ELATED PIECE

In June 2025, the Indian bullion market experienced a dynamic yet broadly positive month, marked by high price levels, brief volatility, and a late-month correction in both gold and silver. Gold prices reached new historic highs during the month. On June 16, MCX gold touched an all-time peak of ₹1,01,078 per 10 grams, reflecting heightened safe-haven demand amid escalating geopolitical tensions, especially the Israel–Iran conflict. However, as tensions eased and global risk appetite improved slightly, gold prices began to retreat. By the end of June, domestic prices had corrected to a range of ₹97,515–₹98,732 per 10 grams. Silver followed a similar trajectory, albeit with more pronounced volatility due to its dual role as both a precious and industrial metal. Silver prices surged past ₹1,05,750 per kilogram mid-month, mirroring gold’s rally, before retreating toward ₹1,03,555–₹1,05,750 per kg. Weak demand from sectors like electronics and solar panels contributed to silver’s softness, though overall investor sentiment remained cautiously bullish. Investment trends in June highlighted diverging behaviour. While jewellery demand slowed significantly after the peak wedding season, investment in physical gold such as bars and coins remained resilient. Buyers, especially retail investors, continued to accumulate gold in anticipation of further long-term gains. Additionally, regulatory support—such as the Reserve Bank of India’s relaxed norms for gold-backed lending—helped sustain institutional and retail interest. Gold exchange-traded funds (ETFs) saw steady inflows in both May and June, underscoring the ongoing preference for gold as a hedge against economic uncertainty and market volatility. The broader global backdrop—featuring U.S. interest rate cuts, a weaker dollar, and lingering geopolitical tensions involving Iran, Israel, and India-Pakistan—contributed to gold’s robust 25% year-to-date returns. In summary, the Indian bullion market in June 2025 reflected a phase of recalibration. After record-breaking highs, both gold and silver entered a phase of mild correction and consolidation. While short-term volatility may persist, driven by evolving global conditions, investor sentiment remains cautiously optimistic, especially with the potential for renewed geopolitical flare-ups and central bank easing on the horizon



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