Gold Prices Surge in India Amid Weak Dollar
Gold prices in India have shown a significant rise today, driven by a combination of a weaker dollar and expectations surrounding a potential interest rate cut by the US Federal Reserve. As noted in the early hours of September 2, gold futures for October were trading 0.47% higher at ₹1,05,280 per 10 grams. In tandem, silver prices also experienced a modest increase, reflecting the overall positive trend in precious metals.
On an international scale, gold has reached record highs, buoyed by safe-haven demand amid ongoing trade tensions. Analysts suggest that the market is currently pricing in a 90% chance of a 25-basis-point rate cut by the Federal Reserve on September 17. This anticipated monetary policy shift is contributing to the bullish sentiment surrounding gold.
Experts believe that the persistent trade war between the US and its key trading partners, including India, adds to the uncertainty in the market. Such factors are expected to weaken the US dollar further. Since gold is priced in dollars, a weaker dollar makes the metal less expensive for buyers in other currencies, thereby increasing demand.
Notably, Jigar Trivedi, a Senior Research Analyst at Reliance Securities, emphasized that the rising expectations for a Federal Reserve rate cut and concerns over tariff policies are crucial in driving gold prices higher. Furthermore, suggestions from analysts point towards keeping an eye on significant MCX levels; MCX Gold has support at ₹1,04,220-1,03,650 and resistance at ₹1,05,200-1,05,850.
Looking ahead, analysts like Sandip Raichura predict that gold could trend towards $3,700 in the medium term, with silver also gaining traction. As prices continue to fluctuate, investors are encouraged to buy gold and silver on dips, with targets of ₹1,07,000 and ₹1,27,000, respectively, in the short term.
In conclusion, with the interplay of global economic factors and local market conditions, investors are advised to stay informed and consult with certified experts before making any investment decisions. The dynamics surrounding gold prices remain fluid, making it essential for stakeholders to monitor market trends closely.
