Gold & Silver Shine in FY 2025 – What’s Next for Investors in FY 2026?

The financial year 2025 has been a remarkable one for precious metals, with gold and silver delivering over 30% returns. While Bank Nifty managed to outperform fixed deposit (FD) returns, broader indices like Nifty 50 and Sensex failed to even beat FD rates, making it a mixed year for equity investors. As we move into FY 2026, the big question remains: Where should investors put their money next?

Bullions Outperform Equities

Gold and silver have historically been considered safe-haven assets, and their stellar performance in FY 2025 reaffirmed this status. Several factors contributed to their strong rally:

• Global Economic Uncertainty: Concerns over inflation, geopolitical tensions, and central bank policies drove investors towards safe assets.

• Weakening Rupee & Dollar Strength: A fluctuating currency market made gold and silver more attractive as hedging instruments.

• Rising Demand: Increased industrial demand for silver, coupled with central banks accumulating gold, supported higher prices.

With such strong momentum, will bullion continue to outperform in FY 2026? Many analysts believe that precious metals could still hold value, especially if economic uncertainties persist.

Bank Nifty Beats FD Returns

Bank Nifty, representing India’s top banking stocks, showed resilience and managed to outperform FD returns in FY 2025. The banking sector benefitted from:

• Stable interest rates supporting credit growth

• Rising corporate earnings and strong asset quality

• Expansion in retail lending

While banking stocks performed well, the broader market struggled, leading us to the underwhelming performance of Nifty 50 and Sensex.

Nifty & Sensex Underwhelm

Despite periodic rallies, Nifty and Sensex failed to generate returns higher than traditional FDs. Some key reasons include:

• Volatility in global markets impacting investor sentiment

• Sectoral underperformance in IT and FMCG

• Profit booking at higher levels

This has left many investors questioning whether equities remain the best choice for long-term wealth creation.

Where Should You Invest in FY 2026?

As we enter FY 2026, investors have multiple options to consider:

1. Gold & Silver: If global uncertainties persist, bullion might continue to perform well.

2. Banking Stocks: With India’s strong economic fundamentals, banking stocks could maintain momentum.

3. Defensive Sectors: FMCG, Pharma, and IT stocks could provide stability in uncertain times.

4. Emerging Sectors: Green energy, AI, and defense sectors offer growth opportunities.

5. Fixed Income Investments: With stable interest rates, FDs and bonds remain a safe bet for conservative investors.

Final Thoughts

FY 2025 proved that diversification is key. While equities had a mixed year, gold and silver emerged as clear winners. As we move forward, keeping an eye on macroeconomic trends, sectoral performances, and global events will be crucial for making informed investment decisions.

Where do you plan to invest in FY 2026? Share your thoughts in the comments!