When we think of gold, the first thing that comes to mind is an inherent desirability for the precious metal among masses in our country. This ever-lasting appeal of gold for the past many decades has seen India emerging as one of the leading gold consumers globally.
If we look at the price of gold (24 karat) in India post-Independence or over the last seven decades, this rare metal has never looked back, surging from Rs 99 per 10 grams in 1950 to Rs 74,050 in 2024 – yielding 750 times returns. Based on this return, an investment of Rs 1,000 in gold back in 1950 would have grown to over Rs 7.5 lakh by now.
Gold hits an all-time high
On May 16, 2024, the gold price hit an all-time high of Rs 74,050 per 10 grams, as per HDFC Securities.
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Gold prices over the past seven decades:
From 1950-2023, gold delivered 9.18% return in terms of Compound Annual Growth Rate (CAGR). From 1960 to 2023, it showed an impressive CAGR of 10.51%. Between 1970 and 2023, the return was at 11.55% CAGR.
From 1980-2023, the return slowed a bit to 9.28%. Between 1990 and 2023, the return on gold investment was recorded at 9.28%. From 2000-2023, this return on gold investment was 12.05%. Since 2010, the return has been steady at 9.51% CAGR.
Gold prices since 2000 till 2024
Since 2000, when gold prices reached Rs 4,400 per 10 grams, the precious metal has given gold investors a return of over 1,500% or nearly 17 times.
In 2020 during the pandemic, gold soared to over Rs 49,000 per 10 grams, showing why it is considered as a “safe haven” for investors during economic downturn. In post-COVID era, gold prices have rallied further, surging past Rs 65,500 in 2023 and hitting a fresh all-time high of Rs 74,000 per 10 grams in 2024.
In the post-COVID times, the surge in gold prices can be attributed to mainly geopolitical tensions, first in eastern Europe due to the Russia-Ukraine war in 2022 and Israel-Hamas war in the Middle East in 2023.
Why is gold considered as a safe-haven asset
People often resort to gold investment in times of economic uncertainties, safeguarding their wealth from impacts of inflation and currency devaluation. Time and again, gold has shown that it is a reassuring asset thanks to its tangible nature and enduring value. Gold investment works like a hedge against economic turmoils, geopolitical tensions and market turbulence.
