Precious metal prices in the domestic markets are expected to remain moderately bullish in the fiscal year 2026-27 as geopolitical tensions, trade war fears and growing recession risks globally are likely to bolster safe-haven demand, even as elevated interest rates may limit sharp gains.
On the domestic front during FY26, silver futures surged by Rs 1,41,431, or 142.2 per cent, from Rs 99,461 per kg recorded on April 1, 2025, while gold soared by Rs 60,258, or 67 per cent from Rs 90,503 per 10 grams recorded during the same period.
The outlook follows one of the strongest years for precious metals in decades. Silver surged more than 142 per cent during FY26, while gold rallied around 67 per cent, driven by Trump's tariff war, geopolitical tensions, robust central bank purchases, tightening supply conditions and global economic uncertainty.
“The outlook for gold and silver for fiscal 2026-27 will remain moderately bullish. Since the global economy is going through a rough patch due to geopolitical tensions, trade wars and fear of global recession, demand for safe-haven assets will rise,” Aamir Makda, Commodity & Currency Analyst at Choice Broking, said.
Despite the strong gains, bullion prices witnessed sharp corrections toward the end of the fiscal. In March alone, gold prices declined by Rs 11,343, or 7 per cent, while silver slumped by Rs 41,752, or 15 per cent on the Multi Commodity Exchange.
On recent price corrections, he said, “Historically gold’s demand as a safe-haven asset will likely increase in the second phase of war situations when dollar gains get limited.” However, Makda cautioned that higher-for-longer interest rates from the US Federal Reserve and other major central banks may limit aggressive upside in bullion prices.
On silver's exceptional performance in FY26, Makda attributed it to a structural supply deficit persisting for five consecutive years, record demand from the solar photovoltaic and electric vehicle sectors and a surge in institutional investment into ETFs that amplified price moves in the relatively smaller silver market.
Looking ahead, Makda expects silver to remain moderately bullish in FY27, with domestic prices likely to trade between Rs 2.75-3.5 lakh per kilogram, depending on currency fluctuations. In international exchanges, the white metal prices may range between USD 85 and USD 100 per ounce, he said.
Makda also expects central bank demand to remain a key support for gold prices in FY27. He said the trend is set to continue in FY27, with demand expected to average between 750-850 tonnes in 2026 and likely to remain the same in 2027.
“Economies such as India, Poland and Turkey will continue to lead the charge as they are replacing US dollar reserves with gold to bolster monetary sovereignty and hedge against geopolitical sanctions,” he added.
On crude oil, Makda projected a shift towards surplus in FY27 due to rising non-OPEC production and slowing global demand growth. “The anticipated drop in oil prices may negatively impact precious metals, particularly gold and silver, by reducing inflationary pressures that typically support these assets. Additionally, softer oil prices may strengthen the rupee, making gold and silver cheaper domestically,” he said.
Regarding the US dollar, Makda expects the currency to remain volatile amid uncertainty over Federal Reserve's policy. However, he cautioned that a stronger dollar could cap gains and trigger corrections, particularly in silver. Overall, Makda said geopolitical risks, central bank demand and industrial consumption will continue to underpin bullion prices in FY27, despite intermittent volatility.
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