Gold prices set for weekly gain: Key factors driving the rates – CNBC TV18
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US gold futures remained steady at $2,711.30 per ounce.
With a gain of over 2% this week, gold is benefiting from renewed buying interest, particularly from top consumer China, which resumed its gold purchases.
In the US, traders are closely watching the Federal Reserve’s decision on interest rates.
A 25-basis-point cut at the December 17-18 meeting is widely expected, with a 96.4% chance predicted by CME’s FedWatch Tool.
Analysts foresee that while the rate cut may briefly dampen gold prices, the bullion’s long-term outlook remains strong in a low-interest-rate environment.
Matt Simpson, senior analyst at City Index, noted, “Gold enjoyed a bullish run heading into this week’s US inflation report, but a sharp reversal should remind gold traders that complacency is dangerous.”
The recent trend in US inflation figures has also contributed to gold’s momentum.
November’s consumer prices showed the largest rise in seven months, fueling expectations for a rate cut.
Furthermore, the European Central Bank and the Swiss National Bank have also lowered interest rates, reinforcing the trend that supports gold prices.
However, in India, gold prices saw a notable decline today.
The price of 22-carat gold dropped by ₹550, reaching ₹72,300 per 10 grams, while 24-carat gold prices
fell to ₹7,887 per gram, according to Goodreturns data.
The drop in prices came after the release of India’s CPI inflation for November 2024, which came in at 5.48%, just under the anticipated 5.50%.
Gold outlook: What lies ahead?
Looking ahead, the focus will remain on the Federal Reserve’s rate decision.
If the Fed cuts rates, gold could see further upward momentum, especially as geopolitical risks persist.
In India, traders will continue to monitor inflation data and global economic indicators.
As per Jateen Trivedi, VP of Research at LKP Securities, “In MCX, resistance is seen at ₹79,500–₹79,850 per 10 grams, while strong support lies near ₹78,000–₹78,100 per 10 grams, keeping the range-bound movement intact in the short term.”
How to invest in gold: Key strategies
For those looking to invest in gold, there are several options.
Direct investment in physical gold, such as coins and jewelry, remains popular, though storage and security costs can be high.
Exchange-Traded Funds (ETFs) and gold mutual funds are more liquid alternatives.
Investors can also explore Sovereign Gold Bonds from secondary market.
–With agencies inputs
