Divergence Across Asset Classes In 2025

Precious metals outperformed equities in 2025 in rupee terms, according to the Global Economic Outlook 2026 released by 1 Finance Research on February 25, 2026. Gold prices increased 72% during the year, supported by central bank purchases totalling 863 metric tonnes, as stated in the outlook. Silver prices increased by 122%, which is the fifth consecutive year of supply deficit.

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The Nifty 500 index, on the other hand, gave a return of 7% in 2025. The report noted that Indian equities were affected by foreign portfolio investor outflows and a 6% depreciation in the rupee against the U.S. dollar during the year.

India’s Growth And Inflation Projections For 2026

According to the Global Economic Outlook 2026, India’s GDP is projected to grow 6.7% in calendar year 2026, while average inflation is expected at 3.9%. According to the report, this provides scope for a cut of 50-75 bps in the repo rate in 2026 by the Reserve Bank of India.

The proprietary 1 Finance Macroeconomic Index indicated that India moved from a transitory slowdown phase in 2025 to a strong recovery phase beginning in 2026.

Global Market Indicators

The report cited that the S&P 500 trades at a price-to-earnings ratio of 29.4x. It added that the U.S. Federal Reserve is expected to deliver two rate cuts in 2026, while the European Central Bank is likely to pause, and the

Bank of Japan is expected to raise rates.

For 2026, the outlook assigned a positive rating to Indian large-cap equities and a positive rating with relatively higher risk to mid- and small-cap stocks. Gold and silver were assigned a risk rating of 3/5 due to their gains in 2025.

The Global Economic Outlook 2026 explained that the macroeconomic indicators of India have changed as the country entered 2026, as the previous year saw triple-digit and high double-digit gains in precious metals, while single-digit gains were recorded in equity markets.