Gold Rate Outlook Shifts: ASK Private Wealth's CIO Somnath Mukherjee Turns Neutral After Two Years

Gold Rate Today: ASK Private Wealth Shifts Stance Amid Rising Volatility

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. However, amid rising volatility and weakening predictive signals from traditional indicators, ASK Private Wealth has shifted its tactical view on gold from "overweight" to "neutral".

The private wealth firm cites a confluence of supportive factors that underpinned the gold rally, including central banks continuing to purchase gold, supporting 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. Additionally, expectations of easing global interest rates and robust consumer demand from key markets such as China and India contributed to its appeal as a safe-haven asset. Inflows into gold-backed ETFs in developed markets and heightened geopolitical tensions also added to its appeal.

However, during the recent period, gold has become fairly volatile, putting its "safe haven" status into question. The Middle East crisis has fanned inflation fears, prompting investors to trim 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.

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Investors are also recalibrating expectations under incoming Fed Chair Kevin Warsh, who has signaled less guidance, a smaller balance sheet, and regime changes, a WGC report noted. Another reason behind the tactical shift in stance is that gold's correlation with other asset classes has either weakened or reversed in their direction. Historically, gold has shown an inverse correlation with equities and interest rates, making it a reliable diversification tool. However, this relationship has weakened in recent months, complicating the investment case for gold, particularly for tactical allocation strategies.