Gold will continue to hold significant value both as a store of wealth and an essential asset for diversification, said Chief Economic Advisor (CEA) Anantha Nageswaran.
Speaking at the 8th IGPC-IIMA Annual Gold and Gold Markets Conference 2025 in New Delhi on Monday, Nageswaran emphasised that gold’s importance will remain salient in the coming years due to ongoing inflationary concerns and the consequences of historical global policy decisions (doing away with gold standard in 1972).
For now, he believes, gold will continue to play a crucial role in providing safety and diversification within investment portfolios, offering a reliable safeguard against the shifting tides of global monetary policies.
Gold’s role
Nageswaran’s remarks focused on the role of gold in an increasingly uncertain global economy, where inflationary pressures, exacerbated by loose fiscal and monetary policies, are creating volatility. He pointed out that the world is still dealing with the effects of policy changes that date back to 1973, when the gold standard was officially removed. This shift has led to the current state of the international monetary system, which Nageswaran described as a “monetary non-system”— one without rules or disciplined structures governing money supply.
“Gold will remain relevant not only as a store of value but also as an ornament for cultural and religious purposes,” Nageswaran stated. “It will also serve as a crucial mechanism for portfolio diversification until the world transitions to a more structured international monetary system.” Nageswaran’s comments underscored the continuing importance of gold in protecting wealth amid economic instability.
He acknowledged the fear of inflation globally and its resurgence in the wake of expansive fiscal policies, particularly in developed nations. “In combination with expansionary fiscal policies and extremely loose monetary policies, we saw inflation creeping back to high single digits in developed countries during 2022-2023,” Nageswaran said. He attributed this inflationary resurgence to a lack of oversight and accountability within the global monetary system. “Because there are no rules, no signposts, and no checks and balances on the discretion of policymakers, we are now relying heavily on asset prices, leverage and the broader health of savings, investments and employment growth.”
Enduring value
Nageswaran’s emphasis on gold’s enduring value aligns with the broader global economic context, where inflation fears remain persistent. The recent economic instability, amplified by policy failures and uncertain global dynamics, has led many to reconsider the role of traditional assets, with gold standing out as a stable and reliable hedge. According to Nageswaran, this continued relevance of gold highlights its indispensable role in the portfolios of investors looking for a safe haven against economic uncertainty.
He also noted that the shift from a monetary non-system to an international monetary system is a long-term and uncertain process, making it even more important for investors to maintain gold as part of their diversified investment strategy. “The day of reckoning, where we move to an international monetary system, is difficult to forecast,” he explained, adding that gold will remain one of the few consistent assets offering stability amid such unpredictability.
As global economies grapple with the consequences of a rapidly changing financial landscape, Nageswaran’s remarks serve as a reminder of the enduring relevance of gold in both wealth preservation and strategic investment planning, economy watchers said.
