Gold rate outlook: ASK Private Wealth's CIO Somnath Mukherjee turns neutral on gold after two years; here's whyAI Quick ReadGold rate today: After delivering strong returns over the past two years, gold may be entering a more uncertain phase, prompting ASK Private Wealth to dial down its bullish stance.
ASK Private Wealth CIO Somnath Mukherjee has shifted his tactical view on gold from “overweight” to “neutral”, citing rising volatility and weakening predictive signals from traditional indicators.
Gold prices have rallied nearly 110% over the last two years, outperforming equities and emerging as one of the best asset classes of recent times.
This rally, according to the private wealth firm, was underpinned by a confluence of supportive factors. Central banks continued to purchase gold, supporting the prices. A World Gold Council (WGC) report stated that central banks remained firm on gold accumulation, with the monthly average of 26t reported in 2025.
Furthermore, expectations of easing global interest rates and robust consumer demand from key markets such as China and India. In addition, inflows into gold-backed ETFs in developed markets and heightened geopolitical tensions added to its appeal as a safe-haven asset.
However, during recent period, gold has become fairly volatile, putting in question its "safe haven" status, said Mukherjee. His comments come against the backdrop of a 5% decline in gold prices in two months, even as the US-Iran war rages on.
The Middle East crisis has fanned inflation fears, prompting investors to trim the rate cut bets for the US Federal Reserve. The Fed is slated to meet this week, and while it is widely expected to hold rates, progress in US‑Iran talks and inflation data releases could quickly shift views on the policy path.
Investors are also recalibrating expectations under incoming Fed Chair Kevin Warsh, who has signalled less guidance, a smaller balance sheet and regime changes, a WGC report noted.
Another reason behind Mukherjee's tactical shift in stance is that gold's correlation with other asset classes has either weakened or reversed in their direction. "Moreover, a clear cyclical pattern in these sets of correlation is observed, reducing their reliability as a future gold price predictor," Mukherjee added.
Historically, gold has shown an inverse correlation with equities and interest rates, making it a reliable diversification tool. But that relationship has weakened in recent months. This evolving dynamic complicates the investment case for gold, particularly for tactical allocation strategies.
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