David Tait, CEO of the World Gold Council, stated at the Rising Bharat Summit on Friday that institutional investors and financial-market infrastructure, rather than people alone, are likely to drive India’s next phase of gold demand.
According to Tait, structural causes, not transient price momentum, are driving the present gold rise. He cited geopolitics, interest rates, central bank purchases, and what he called a growing “fear of uncontrolled global debt” as the six or seven primary reasons why gold will continue to rise. “I know you would expect me to say gold is going up, given my position,” he added.
He cited periods of tension in US bond markets after policy shocks as proof that worries about the sustainability of debt, not only inflation, are influencing investor behavior. According to Tait, the only thing that could put public debt on a downward trajectory and change the picture for gold would be an improbable spike in US economic growth to 6-7 percent along with moderate inflation.
According to Tait, pension funds, insurance corporations, and other sizable institutional capital pools that incorporate gold into portfolios would probably have a greater influence on India’s future gold demand. He also mentioned that in addition to traditional jewelry, younger investors are more interested in financial ways to buy gold, especially through gold-backed exchange-traded funds.
He stated that central bank purchases continue to be a vital source of market support. With no indication of selling despite significant price increases, Tait stated that the majority of central banks in developing nations are still holding gold as a diversifier for their portfolios and as a hedge against currency fluctuations and geopolitical risk.
According to him, the World Gold Council has concentrated on lowering the barriers that have traditionally restricted the use of gold in conventional portfolios. He said that institutional adoption of gold is still in its infancy in major economies like China, Japan, and India. “We have spent a lot of energy trying to make gold less capital intensive, easier to retain, more divisible, more trusted, and more transparent,” he said.
Tait also pointed out that the omission of gold from the high-quality liquid asset classification has limited institutional use, and that regulatory recognition might be a turning moment for the metal’s place in the financial system. He outlined proposals for a new digital allocated gold market that would provide fractional legal ownership of physical gold and enhance its utility as collateral, making a distinction between tokenization and broader digitalization efforts.
According to Tait, gold-backed ETFs now provide the most practicable approach within the nation’s legal structure, and modern investment avenues are more likely to complement conventional demand than to replace it.
