The gold market has just delivered a masterclass in volatility. While the Economic Survey 2025-26 recently highlighted gold’s staggering 116% return over the past year, the market immediately countered with a “Metals Massacre.”
On Friday, January 30, 2026, spot gold on the MCX plunged 4.87% to ₹167,095, while silver and major gold ETFs like Axis and 360 One saw even deeper cuts of 10% or more.
The Economic Survey: Why Gold Hit Records in 2025
According to Chief Economic Advisor (CEA) V. Anantha Nageswaran, the record-breaking surge in 2025 wasn’t accidental. It was driven by three pillars:
- Geopolitical Friction: US tariff announcements and global policy uncertainty turned gold into a “strategic anchor.”
- A Fragile Dollar: A weakening US dollar for much of 2025 made bullion the preferred hedge for global investors.
- India’s Strategic Shift: India’s gold reserves surged from $78.2 billion in March 2025 to a massive $117.5 billion by January 2026.
Why Did the Market Crash on Friday?
If the fundamentals are so strong, why the sudden $400+ drop? The catalyst was a “regime shift” in US monetary expectations.
The nomination of Kevin Warsh—a known “inflation hawk”—as the potential new US Fed Chair sent shockwaves through the market. His reputation for favoring higher interest rates caused the US dollar to rally to a 4-year high, sparking a massive unwinding of gold positions. Experts are calling this a “euphoria-to-exhaustion” phase, where speculative froth is being purged from the system.
Future Outlook: Rally or Retraction?
The Economic Survey 2026 offers a nuanced view. While it acknowledges that global commodity prices are projected to decline by 7% in FY27, it explicitly notes that “geopolitics may come in the way of this prediction.”
Key Takeaways for Investors:
- The Support Zone: Analysts are watching the ₹1.40L – ₹1.45L range as a critical support level for gold.
- Central Bank Activity: As long as central banks continue to diversify away from the dollar, the structural bull case for gold remains intact.
- Geopolitical Hedge: The survey suggests that elevated prices will persist as long as trade wars and global “fiscal strains” remain unresolved.
Final Thoughts for MarketTechGuru Readers
This dip isn’t necessarily the end of the bull run; rather, it’s a reality check. For those looking to master business and investing, understanding that no rally moves in a straight line is the first step toward genius.
The Economic Survey reminds us that gold is no longer just “jewelry”—it is a strategic buffer for nations and individuals alike.
