In 2025, gold delivered tremendous returns to investors, which overshadowed the stock market’s performance. The rally continued in early 2026, with gold prices reaching ₹1,80,779 per 10 grams on the Multi Commodity Exchange of India (MCX). However, this was followed by a sharp decline, and on Friday last week, the price fell to ₹1,56,200 per 10 grams, showing a fall of about ₹24,500, or about 13.5 per cent, in a single week.
Why such a sharp fall in gold?
Even in the international market, gold prices have fallen below record levels. Spot gold fell from a high of $5,626 an ounce to about $5,046.30 an ounce, showing a decline of about 10.5 percent. According to analysts, a major reason for this decline is reports related to Russia. Citing Russia’s international documents, Bloomberg reported that the Kremlin is considering expanding economic partnership with the US and Moscow may be willing to trade in the US dollar. If this happens, it will be considered a blow to the “de-dollarization” strategy of the BRICS countries.
What do experts say?
Earlier, there was talk of increasing the role of local currency or gold as an alternative to the dollar in trade between BRICS countries. However, Russia’s possible return to the dollar has weakened this sentiment, which has weighed on the sharp rise in gold prices. Apart from this, uncertainty regarding US inflation data and interest rates is also putting pressure on gold.
If the US Federal Reserve pauses rate cuts or maintains a dovish stance, the dollar could strengthen, and a stronger dollar is generally considered negative for gold prices. Overall, global geopolitical cues, dollar strength and interest rate uncertainty have played a key role in gold’s recent sharp decline.