Gold prices hit all-time high; experts predict surge to ₹78,000 per 10 grams soon
Gold prices surged to a new record high on Tuesday (September 24). The spot price of gold reached $2,638.37 per ounce during the session, while US gold futures rose to $2,661.60.
In India, the cost of 24-carat gold climbed to ₹76,330 per 10 grams.
This marks a continuation of gold’s upward trajectory, with the precious metal hitting an all-time high yesterday as well.
The momentum in gold prices suggests that they could soon approach ₹78,000 per 10 grams in the Indian market.
Factors driving gold prices
The recent spike in gold prices can be attributed to several key factors:
Dovish Fed rhetoric: US Federal Reserve officials have suggested a series of rate cuts, with futures traders pricing in a total of 75 basis points in cuts by the end of 2024.
This environment typically favors gold as a safe investment. Lower interest rates reduce the opportunity cost of holding non-yielding bullion.
Geopolitical tensions: The ongoing conflict between Israel and Hezbollah has heightened demand for gold as a safe-haven asset.
Recent airstrikes and rising casualties have added to market uncertainty, driving investors toward gold to hedge against geopolitical risks.
Seasonal demand in India: Despite the ongoing Shradh period, which typically dampens gold demand, the festive season is approaching.
Analysts anticipate a surge in purchases leading up to Navratri and Dhanteras.
Future trends
Industry experts are optimistic about gold’s future trajectory.
Colin Shah, MD of Kama Jewelry, forecasts that gold prices could reach $3,000 per ounce globally in the medium to long term.
He attributes the current rally to positive global cues and anticipates further rate cuts from the US Fed. In the Indian market, he expects gold prices to exceed ₹78,000 per 10 grams during the festive season.
Renisha Chainani, Head of Research at Augmont, echoes this sentiment.
She notes 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 adds that the price in India could continue to rise.
Should one invest now?
Given the current climate, many experts suggest that now might be a prudent time to invest in gold.
The combination of dovish Fed policies, rising geopolitical tensions, and seasonal demand could further drive prices upward. Investors should consider gold as a hedge against potential market volatility and take advantage of the prevailing bullish trend.