On the Multi Commodity Exchange (MCX), October gold contracts saw a 0.46% rise.
This reflects growing interest in the precious metal, with a turnover of 16,860 lots.
This spike in gold prices aligns with global trends, where gold futures climbed by 0.38% to $2,556.10 per ounce in New York.
The increase is largely driven by rising expectations of a Federal Reserve rate cut next month, following hints from Federal Reserve Chair Jerome Powell at the Jackson Hole Symposium.
Powell’s comments on inflation nearing the US central bank’s 2% target and the potential for a cooling job market have supported market confidence in a September rate cut.
Kaynat Chainwala, AVP-Commodity Research at Kotak Securities, said “Comex Gold December futures movement is driven by expectations of a Fed pivot. Today, COMEX Gold trades above $2,545/oz as the dollar slipped to its lowest since July 2023, and US 10-year treasury yields remain below 3.8%.”
Pranav Mer, Vice President, EBG – Commodity & Currency Research at JM Financial Services Ltd., added, “Gold continues to trade positively, supported by rising rate cut bets and safe-haven demand due to escalating tensions in the Middle East. Central bank buying and ETF investments are also expected to provide additional support in the near term.”
For investors, the momentum in gold prices appears positive, with support levels around ₹71,550 to ₹71,300 and potential upside targets of ₹72,300 to ₹72,500.
Mer advises buying on dips, reflecting the belief that gold’s upward trajectory will continue, particularly if rate cut expectations solidify.
Looking ahead, the market will closely watch key US economic data, including GDP, Core PCE, and consumer confidence, which could influence the Fed’s decision-making process.
While the current sentiment favors further gains in gold, caution is advised as any surprising economic strength could temper the rate cut narrative and cap the upside in gold prices.
