Gold Rate Today: The price of gold in the domestic market has seen a notable increase, despite a trend of profit-booking in the spot gold market. As of last week, the MCX gold rate surged by 0.60%, reaching ₹76,190 per 10 grams. In contrast, the spot gold price experienced a slight decline of 0.40%, closing at $2,653 per troy ounce. Analysts attribute the rise in domestic gold prices to the weakening of the Indian National Rupee (INR), which depreciated by approximately 0.40% against the US dollar. This dynamic is fueling gold prices domestically, even as global trends reflect a downward movement.
The rebound of the US dollar in the forex market has triggered profit-booking within the international bullion market. Nevertheless, experts believe that escalating geopolitical tensions, particularly the ongoing conflict between Israel and Iran, may continue to protect gold prices from further declines. If the conflict persists, a significant increase in gold prices is anticipated.
Factors Influencing Gold Prices
According to Sugandha Sachdeva, Founder of SS WealthStreet, several factors influence gold prices in both domestic and international markets. The modest gains observed recently in domestic markets, alongside a slight decline in international markets, can be primarily linked to the depreciation of the Indian rupee, which has increased domestic gold prices against a backdrop of global downturns. Below is a summary of essential triggers affecting gold prices.
| Trigger | Impact |
|---|---|
| US Dollar Performance | A stronger dollar tends to limit gold’s appeal as an alternative investment. |
| Geo-Political Tensions | Conflicts can elevate gold’s safe-haven status, pushing prices higher. |
| US Employment Data | Positive employment reports can reduce expectations for rate cuts, affecting gold prices negatively. |
| INR vs. USD | A weaker INR increases domestic gold prices, creating a barrier to falling international prices. |
The rebound in the US dollar index has also played a crucial role in curbing gold’s price rise. Recently, the dollar has reached a one-month high, and robust US employment data for September reveals an increase of 254,000 jobs against expectations of only 147,000, prompting a decline in speculations about aggressive rate cuts from the US Federal Reserve. The unemployment rate also fell to 4.1%, below the anticipated 4.2%. Such positive economic indicators tend to benefit the dollar while making gold appear less attractive.
“Gold’s appeal as a safe haven has been bolstered by rising geopolitical tensions in the Middle East,” noted Sachdeva. Despite this, the precious metal faces significant resistance at the $2,680 per ounce level in international markets and at ₹76,600 per 10 grams in domestic environments. Overcoming these resistance points may pave the way for further price advancements.
Praveen Singh, Associate VP, Fundamental Currencies and Commodities at Sharekhan by BNP Paribas, recommends a buy-on-dips strategy amid escalating tensions in the Israel-Iran region. He forecasts gold price movements to remain confined to a range of $2,620 to $2,685 as the market awaits the release of crucial US nonfarm payroll data, which could significantly affect pricing.
For today’s gold price outlook, Sugandha Sachdeva emphasizes the enduring impact of geopolitical risks on investor sentiment towards gold. The potential for military escalations in the Middle East could further stimulate demand for gold as a security measure against uncertainty. Current market patterns suggest strong support for gold prices in the ₹75,200 to ₹75,000 per 10 grams range, which may attract buying interest. If gold exceeds the critical resistance at ₹76,600 per 10 grams, it may continue to rise toward ₹78,000 in the near term.
Disclaimer: The opinions and recommendations in this analysis reflect individual analysts’ or broking companies’ views and do not represent Mint’s stance. It is advisable for investors to consult with certified professionals before making investment decisions, as market conditions can change quickly and individual circumstances may vary significantly.
