Most recent article: India Gold price Thursday: Gold falls, according to MCX data
Gold prices rose in India on Wednesday, according to data from India's Multi Commodity Exchange (MCX).
Gold price stood at 62,224 Indian Rupees (INR) per 10 grams, up INR 378 compared with the INR 61,846 it cost on Tuesday.
As for futures contracts, Gold prices increased to INR 62,585 per 10 gms from INR 62,476 per 10 gms.
Prices for Silver futures contracts decreased to INR 74,927 per kg from INR 74,824 per kg.
| Major Indian city | Gold Price |
|---|---|
| Ahmedabad | 64,440 |
| Mumbai | 64,205 |
| New Delhi | 64,360 |
| Chennai | 64,400 |
| Kolkata | 64,385 |
Global Market Movers: Comex Gold price bulls take a pause ahead of the US PCE Price Index on Friday
- Growing acceptance that the Federal Reserve (Fed) will pivot away from its hawkish stance early next year continues to act as a tailwind for the Comex Gold price.
- Chicago Fed President Austan Goolsbee said the central bank is not pre-committing to cutting interest rates soon and should not be bullied by what the market wants.
- Cleveland Fed President Loretta Mester noted on Monday that financial markets had got a little bit ahead of the central bank on when to expect interest rate cuts next year.
- The markets, however, have priced in a more than 60% chance that the Fed will cut rates as soon as March 2024 and a total of 140 basis points of rate reductions in 2024.
- The yield on the benchmark 10-year US government bond languishes below the 4% mark, with the US Dollar hovering just above a multi-month low touched last week.
- The global risk-on rally remains uninterrupted amid expectations of lower interest rates in the US, more stimulus from China and dovish Bank of Japan, capping the safe-haven metal.
- Traders now look to the US Consumer Confidence Index for some impetus later this Wednesday, though the focus remains on the release of the US PCE Price Index on Friday.
(An automation tool was used in creating this post.)
Gold FAQs
Why do people invest in Gold?
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Who buys the most Gold?
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
How is Gold correlated with other assets?
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
What does the price of Gold depend on?
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
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