A recent Morgan Stanley report highlights the crucial role of gold in bolstering the financial strength of Indian households. Valued at an estimated $3.8 trillion, gold holdings in Indian homes now account for nearly 88.8 percent of the country’s GDP. With gold prices hitting record highs, the report notes a positive impact on household wealth, underscoring gold’s continuing significance in family finances.
Global and domestic gold prices have surged this year. Internationally, an ounce of gold is trading at $4,056, while in India, 10 grams cost approximately ₹1,27,300. The report reveals that gold prices have risen 54.6 percent in dollar terms and 61.8 percent in rupee terms so far in 2025, reflecting strong market demand and investor interest.
India remains the world’s second-largest consumer of gold after China, accounting for 26 percent of global consumption, largely driven by household purchases. Investment trends, however, are evolving, with growing interest in financial products such as gold ETFs. Over the past 12 months, $1.8 billion has flowed into gold ETFs, reflecting a shift from physical holdings to more liquid assets.
The Reserve Bank of India (RBI) has also expanded its gold reserves, acquiring approximately 75 tons since 2024, taking total holdings to 880 tons, or 14 percent of India’s foreign exchange reserves. Morgan Stanley noted that stable macroeconomic conditions, moderate inflation at around 5 percent, and positive interest rates have kept gold imports under control. Currently, gold imports account for 1–1.5 percent of GDP, significantly lower than the record 3.3 percent in May 2013, helping ease pressure on India’s current account deficit.
