Editor’s Note
After reaching record highs in January, gold prices have retreated significantly in both domestic and international markets this month. This article examines the recent correction and its implications for investors.
Gold, which delivered bumper returns to investors in 2025, hit a record high above ₹1,80,000 in January 2026, but appears to be coming down to earth in February. Last Friday, the price of gold on the Multi Commodity Exchange (MCX) closed at ₹1,56,200 per 10 grams. This means it has fallen by nearly ₹24,500 from its record high. The situation is similar in the international market (COMEX). Here, gold has fallen 10.50% from its peak to $5,046.
Market experts believe that the stormy rally in gold prices has now been halted. According to a Bloomberg report, Russia is once again considering agreeing to trade with the United States in dollars. For the past few years, Russia and China have been leading the de-dollarization movement, i.e., trade without the dollar, and accumulating gold reserves.
But now there is news that the Putin administration wants economic partnership with the United States in seven key sectors. The return to a dollar-based payment system is the most significant among these. It is believed that this move could be part of a secret agreement to end the Russia-Ukraine war. If the world’s second-largest gold producer (Russia) resumes trading in dollars, it would be a huge blow to gold demand.
Central banks worldwide have played a major role in sending gold prices soaring. SEBI-registered expert Anuj Gupta said that ever since Donald Trump returned to the White House and tariff policies began, countries started buying gold, considering it a safe alternative to the dollar.
Amit Goel, Chief Global Strategist at PACE 360, has made a major prediction regarding gold. He said gold has seen its record high level. Any minor rally from here will merely be a dead cat bounce. He estimates that by the end of 2027, gold prices in India could fall below ₹1,00,000 per 10 grams. Meanwhile, in the international market, it could tumble to $3,000 per ounce. He advised that considering gold a safe investment now could be risky. Instead, long-term government bonds could prove to be safer and offer better returns.
Furthermore, hints from an internal Kremlin memo suggest that Russia envisions a major partnership with US President Trump in the areas of fossil fuels, natural gas, and raw materials. Trump’s policy has always been to strengthen the dollar. Russia knows that if it wants to benefit from the American market and technology, it must adopt the dollar.