Gold prices surge to two-week high: Key factors driving the bullish trend – CNBC TV18
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Spot gold rose 0.2% to $2,698.47 per ounce, reaching its highest point since November 25.
US gold futures climbed 0.6% to $2,734.70 per ounce.
In India, gold rates also saw a significant rise.
The price of 24-carat gold surged by ₹820, reaching ₹7,878.3 per gram, while 22-carat gold rose by ₹750, now priced at ₹7,223.3 per gram.
Factors driving the gold surge
Investors are closely watching the US Consumer Price Index (CPI) report, expected to show a 0.3% rise in November.
This data could influence the US Federal Reserve’s policy outlook for 2025.
With the Fed widely expected to cut interest rates by 25 basis points on December 18, many analysts believe this could serve as a catalyst for further gold price increases.
“The expected CPI number pretty much gives the Fed the green light to cut interest rates next week, which could be the trigger we need to see gold prices rise,” said Kyle Rodda, a financial market analyst at Capital.com.
Geopolitical uncertainty and safe-haven demand
On the geopolitical front, tensions are escalating. The Israeli military recently targeted strategic weapons stockpiles in Syria, while political unrest in South Korea added to global uncertainties.
This volatility has spurred safe-haven demand, with gold traditionally thriving in such environments.
Renisha Chainani, Head of Research at Augmont – Gold For All, highlighted that the ongoing instability in Syria and the growing tensions in the region have reinforced gold’s appeal as a safe-haven asset.
Bullish outlook for gold
Gold prices have gained momentum, breaking the $2,720 per ounce mark (₹78,000 per 10 grams) and setting its sights on $2,760 per ounce (₹79,500 per 10 grams).
Rahul Kalantri, VP of Commodities at Mehta Equities Ltd, emphasised the role of safe-haven demand in driving the gains.
“The political crisis in Syria and South Korea, coupled with China’s resumed gold buying and upcoming economic stimulus, have created a bullish environment for gold,” Kalantri stated.
However, he also cautioned that US inflation concerns could limit further gains.
Outlook and investment strategy
As geopolitical tensions persist and the US Federal Reserve is expected to cut rates, gold is well-positioned to benefit.
Investors are advised to monitor US inflation data closely, as it will likely influence short-term price movements. In India, with gold prices trending upward, investors may consider buying on dips, especially with the support level at ₹78,080-₹77,840 per 10 grams and resistance around ₹78,690-₹78,940 per 10 grams for gold.
–With agencies inputs
