Gold Market Recap: RBI Rate Cut Pushes Prices Over ₹1.3 Lakh on 5 December 2025
Gold prices surged in India, crossing the ₹1.3 lakh mark for 10 grams. The rally was driven by the Reserve Bank of India's decision to cut its key repo rate.
⚡ Key Highlights
- 1Gold prices rose by 0.47%, with 24K gold hitting ₹130,260 per 10 grams.
- 2The RBI's 25 basis point repo rate cut was the primary driver for the surge.
- 3MCX gold futures soared, hovering near the significant ₹1.30 lakh per 10 grams mark.
- 4Silver futures also rose, hitting a record high on positive trade news.
- 5Long-term forecasts suggest international gold prices could target $4,600–$4,800 in 2026.
Gold prices saw a significant rally across India on Friday, 5 December 2025, bringing cheer to investors but signaling higher costs for jewelry shoppers. The precious metal gained considerable ground, with prices for 24-carat gold climbing to ₹130,260 per 10 grams. The day's upward movement was consistent across major metropolitan areas, including Mumbai, Delhi, Chennai, and Hyderabad, with reports confirming a broad-based surge in retail rates. The overall increase for the day was reported to be 0.47%, a notable single-day jump that caught the market's attention.
The primary catalyst for this price surge was the Reserve Bank of India's monetary policy announcement. The RBI decided to cut the repo rate by 25 basis points to 5.25%, a move that immediately boosted the appeal of non-yielding assets like gold. A lower interest rate environment reduces the opportunity cost of holding bullion, prompting investors to shift funds into the safe-haven metal. This sentiment was clearly reflected in the futures market, where MCX gold futures contracts expiring today soared to hover near the psychological milestone of ₹1.30 lakh per 10 grams.
The positive momentum was not limited to gold. Silver also had a stellar day, with futures rising sharply and hitting a new record high of ₹1.79 lakh per kilogram, partly driven by the RBI's decision and optimistic news regarding India-Russia trade hopes. While the overall trend for bullion was bullish, some market reports noted a "divergent trade" in futures, suggesting varied activity across different contracts.
For investors and buyers, today’s price action reinforces a strong bullish outlook for the precious metal. The rally aligns with long-term forecasts from market analysts, who predict international gold prices could touch between $4,600 and $4,800 in 2026. This suggests that the current upward trend may have further to run, strengthening gold's position as a critical component for portfolio diversification. For those planning to buy jewelry, the current high prices might persist, making any potential dips a strategic buying opportunity.