Gold and Silver Price Trajectory in FY27: Safe Haven Demand Meets Central Bank Accumulation

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• April 26, 2026
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Gold prices are projected to maintain elevated levels through FY27, with analysts forecasting a range of ₹85,000–95,000 per 10 grams domestically amid persistent geopolitical uncertainty and central bank buying. Silver is expected to outperform gold on a percentage basis, driven by dual demand from industrial applications and investment flows, with targets between ₹1,05,000–1,20,000 per kilogram.

New Delhi, April 2026 — The precious metals complex enters FY27 with gold having delivered a 22% return in FY26, marking its strongest annual performance since FY21 when pandemic-driven safe haven flows pushed prices to then-record highs. Indian gold imports surged to 785 tonnes in calendar year 2025, straining the current account deficit and prompting renewed policy debate about import duty structures and sovereign gold bond issuance timelines.

What Is Driving Gold and Silver Higher?

Central bank accumulation remains the dominant structural driver, with the Reserve Bank of India adding 72 tonnes to its reserves in calendar 2025 alone, bringing total holdings to 876 tonnes. The People’s Bank of China and Turkish central bank have maintained aggressive buying programmes, collectively absorbing supply that would otherwise moderate prices. Real interest rates across developed markets remain compressed despite nominal rate adjustments, reducing the opportunity cost of holding non-yielding bullion. Geopolitical risk premiums from ongoing conflicts in Eastern Europe and the Middle East continue embedding themselves into baseline gold valuations.

What Does This Mean for Indian Investors and Consumers?

Indian households holding an estimated 25,000 tonnes of gold are experiencing significant wealth effects, with rural and semi-urban portfolios disproportionately benefiting from price appreciation. Wedding season demand faces affordability pressures, with jewellers reporting a shift toward lighter-weight ornaments and higher gold exchange transactions. The gold-to-silver ratio, currently near 78:1, suggests silver offers relative value for investors seeking precious metals exposure with higher beta characteristics. Sovereign Gold Bonds maturing in FY27 will return principal plus accrued interest at prevailing market prices, generating windfall gains for early subscribers.

How Does India Compare to Global Precious Metals Markets?

India’s domestic gold premium over international benchmarks has narrowed to $1.50–2.00 per ounce, indicating healthy supply flows following the 2023 duty rationalisation from 15% to 10%. Chinese gold premiums have been volatile, swinging between $30 premiums and $15 discounts, reflecting demand uncertainty and currency considerations. ETF holdings globally have stabilised after significant outflows in 2022–2023, with Indian gold ETFs witnessing net inflows of ₹4,200 crore in FY26. Silver’s industrial demand, particularly from solar photovoltaic manufacturing expanding rapidly in Gujarat and Rajasthan, adds a structural floor to prices.

• Gold delivered 22% returns in INR terms during FY26, outperforming Nifty 50’s 14% gain
• RBI gold reserves reached 876 tonnes by March 2026, up from 804 tonnes in March 2025
• Silver industrial demand from solar PV manufacturing grew 34% year-on-year in India
• Domestic gold imports totalled 785 tonnes in calendar 2025, second-highest on record
• Gold-to-silver ratio at 78:1 remains above the 20-year average of 68:1

What Should Investors Watch in FY27?

Federal Reserve policy trajectory remains critical, with any acceleration in rate cuts likely to propel gold toward the $2,800–3,000 per ounce range internationally. Indian rupee movements against the dollar will amplify or dampen INR-denominated returns, with a weaker rupee providing additional tailwinds. Silver’s industrial demand profile makes it sensitive to global manufacturing PMI readings and specifically to solar installation rates in China, Europe, and India. Government decisions on import duties ahead of the Union Budget 2026 could trigger short-term volatility.

Analyst’s View

Precious metals enter FY27 with fundamentals favouring continued strength, though the pace of gains will likely moderate from FY26’s exceptional performance. The strategic case for gold allocation between 8–12% of portfolios remains intact for Indian investors seeking currency hedge and geopolitical insurance. Silver presents asymmetric upside given compressed ratios and accelerating green energy demand, though volatility will exceed gold’s by a factor of 1.5–2x. Monitor central bank purchasing data monthly and US real yields weekly as the two variables most predictive of directional moves.