Gold prices reach record high, could soon hit ₹78,000/10g
What's the story
Gold prices have reached an all-time high, with the spot price of gold hitting $2,638.37 (₹2.2 lakh) per ounce (28.3g) during today's session.
Concurrently, US gold futures also saw a significant increase to $2,661.60 (₹2.23 lakh).
In India, the price of 24-carat gold rose to ₹76,330 per 10g. This upward trend in gold prices is expected to continue, with predictions suggesting they could soon approach ₹78,000 per 10g in the Indian market.
Market drivers
Factors influencing the surge in gold prices
The recent surge in gold prices can be attributed to several factors including dovish US Federal Reserve rhetoric, geopolitical tensions, as well as seasonal demand in India.
Fed officials have hinted at a series of rate cuts by the end of 2024, which typically favors gold as a safe investment.
The ongoing conflict between Israel and Hezbollah, has also increased demand for gold as a safe-haven asset amid market uncertainty.
Forecast
Seasonal demand and future trends
Despite the ongoing Shradh period, which usually dampens gold demand, analysts expect a surge in purchases leading up to Navratri and Dhanteras.
Industry experts are optimistic about gold's future trajectory.
Colin Shah, MD of Kama Jewelry, predicts that gold prices could touch $3,000 (₹2.5 lakh) per ounce globally in the medium to long term, due to positive global cues and further rate cuts from the US Fed.
Insights
Expert opinion on future gold price trends
Renisha Chainani, Head of Research at Augmont, agrees with Shah's forecast. She believes that geopolitical concerns and US economic conditions will likely sustain support for gold prices.
The upcoming Federal Open Market Committee (FOMC) meetings and economic data releases, will be critical in determining market direction.
She also suggests that the price in India could continue to rise.