Daijiworld Media Network - New Delhi
New Delhi, Nov 5: Gold and silver are expected to remain supported over the medium to long term despite heightened price volatility in 2026, with market corrections offering investors opportunities to accumulate the precious metals, according to a report released by Motilal Oswal Financial Services on Thursday.
The outlook comes even as the rally in gold has temporarily paused.
“Unlike the largely one-directional rally witnessed in 2025, precious metals have experienced sharper swings in 2026, driven by changing expectations around US interest rates, persistent inflation, elevated bond yields and geopolitical developments,” the report said.
Gold's near-term movement will remain sensitive to the US Federal Reserve's monetary policy, inflation trends, fluctuations in the US dollar and real bond yields, said Navneet Damani, Head of Research – Commodities at Motilal Oswal Financial Services.
However, diversification by central banks, sustained investment demand and fiscal uncertainties continue to provide structural support to gold, Damani added.
The report maintained a 'buy on dips' strategy for gold, identifying an international accumulation range of $3,800-$3,900 per ounce. It set a short-term target of $4,200 and a medium-term target range of $4,500-$4,700 per ounce.
In the domestic market, assuming a USD/INR exchange rate of 96, the report identified Rs 1,35,000 per 10 grams as the preferred accumulation level. It set a short-term target of Rs 1,48,000 and a medium-term target range of Rs 1,60,000-Rs 1,68,000 per 10 grams.
The report noted that investment demand for precious metals had remained resilient despite elevated prices.
Global gold exchange-traded fund (ETF) holdings increased by around 187 tonnes during August and September 2026, reaching a record 4,256 tonnes. Inflows during the third quarter also touched a record $31 billion.
In India, gold ETF inflows increased 71 per cent month-on-month to Rs 44.5 billion in September, while silver ETFs attracted inflows worth Rs 19.7 billion.
Gold had surged to a record high of nearly $5,600 per ounce in January 2026 before correcting below $4,000 and subsequently recovering. Silver also rallied above $100 per ounce before witnessing an even sharper correction.
Similar volatility was witnessed in domestic markets, further amplified by fluctuations in the USD/INR exchange rate.
The report also observed that historical trends suggest festive-season demand has a stronger correlation with domestic premiums, imports and physical buying volumes than with international price movements.
Diwali and Dhanteras continue to be among India's most important occasions for purchasing precious metals, driven by traditional buying practices, the wedding season and the cultural significance attached to gold and silver.
Historical performance also indicates that gold has generally delivered stronger returns during the 30 days preceding Diwali than during the subsequent 30-day period.