Most recent article: India Gold price Tuesday: Gold edges lower, according to MCX data
Gold prices fell in India on Monday, according to data from India's Multi Commodity Exchange (MCX).
Gold price stood at 62,147 Indian Rupees (INR) per 10 grams, down INR 240 compared with the INR 62,387 it cost on Friday.
As for futures contracts, Gold prices decreased to INR 62,337 per 10 gms from INR 622,294 per 10 gms.
Prices for Silver futures contracts increased to INR 71,390 per kg from INR 70,774 per kg.
| Major Indian city | Gold Price |
|---|---|
| Ahmedabad | 64,275 |
| Mumbai | 64,140 |
| New Delhi | 64,280 |
| Chennai | 64,270 |
| Kolkata | 64,340 |
Global Market Movers: Comex Gold price awaits clarity about the Fed's rate cut path before placing directional bets
- Growing acceptance that the Federal Reserve will keep interest rates higher for longer in the wake of a still resilient US economy acts as a headwind for the non-yielding (Comex) Gold price.
- Moreover, the recent hawkish remarks by a slew of influential FOMC members forced investors to scale back their expectations for early and steep interest rate cuts this year.
- Dallas Fed Bank President Lorie Logan said on Friday that there is no urgency to cut rates and that she wants further evidence on inflation to confirm the progress is durable.
- Atlanta Fed President Raphael Bostic noted that inflation has been too high for too long, and there is still a way to go and that the US is on a path to pre-pandemic economic activity.
- The annual revisions published by the Labor Department showed on Friday that US consumer prices increased slightly more than previously reported in October and November.
- The US Dollar, however, struggles to gain any meaningful traction in the wake of the uncertainty about the likely timing and pace of interest rate cuts by the Fed this year.
- Traders also prefer to wait on the sidelines and look to the latest US consumer inflation figures on Tuesday for cues about the Fed's rate-cut path before placing directional bets.
- Relatively thin trading volumes on the back of holidays in Japan and China further contribute to the subdued range-bound price action on the first day of a new week.
- The Israel military said on Monday that it had concluded a series of strikes in southern Gaza, easing fears about broadening the Israel-Palestinian conflict across the Middle East.
(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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