Most recent article: India Gold price today: Gold rises, according to MCX data
Gold prices fell in India on Friday, according to data from India's Multi Commodity Exchange (MCX).
Gold price stood at 61,692 Indian Rupees (INR) per 10 grams, down INR 268 compared with the INR 61,960 it cost on Thursday.
As for futures contracts, Gold prices decreased to INR 61,970 per 10 gms from INR 61,977 per 10 gms.
Prices for Silver futures contracts decreased to INR 70,000 per kg from INR 70,269 per kg.
| Major Indian city | Gold Price |
|---|---|
| Ahmedabad | 64,060 |
| Mumbai | 63,920 |
| New Delhi | 63,995 |
| Chennai | 64,040 |
| Kolkata | 64,075 |
Global Market Movers: Comex Gold price struggles amid mixed fundamentals
- Israel intensified its bombardment on Gaza's Rafah, while Yemen's Iran-aligned Houthis rebels stepped up attacks on ships in the Red Sea, raising the risk of a wider war in the Middle East and underpinning the safe-haven Gold price.
- The US Dollar struggles to capitalize on the previous day's goodish rebound from its lowest level in almost three weeks and lends additional support to the Comex Gold price, though the Federal Reserve's hawkish outlook might cap gains.
- Minutes of the latest FOMC policy meeting released on Wednesday pointed to a broad uncertainty about how long borrowing costs should remain at their current level to bring down inflation back to the central bank's 2% target.
- Fed Vice Chair Philip Jefferson thinks that the central bank could begin to cut rates later this year, though said that he will be looking across a broad set of economic indicators for conviction that it is time to lower borrowing costs.
- Meanwhile, Philadelphia Fed President Patrick Harker noted that the central bank is getting close to cutting rates but a move in the near term is unlikely and emphasized that he doesn’t want to cut too early and re-ignite inflation.
- Separately, Fed Governor Lisa Cook noted that it is not yet time to reduce interest rates as the path towards the 2% inflation goal has been and could still be bumpy and uneven, citing the recent stronger consumer inflation figures.
- Furthermore, Fed Governor Christopher Waller said that policymakers should delay rate cuts by at least another couple more months to see if the hot inflation print in January was just a speed bump in the road toward price stability.
- As per the CME Group's FedWatch Tool, the markets are pricing in around a 30% chance that the Fed will start cutting interest rates in May, while the odds for a move at the June FOMC policy meeting currently stand at about 66%.
- Data released on Thursday showed that the number of Americans applying for unemployment insurance benefits fell from 213K to 201K during the week ending February 17, offering fresh signs of strength in the labor market.
- The yield on the benchmark 10-year US government bond holds steady near its highest level since late November, acting as a tailwind for the Greenback and capping the non-yielding yellow metal amid the prevalent risk-on mood.
- The better-than-expected release of the flash Eurozone PMI prints suggested that the downturn in the business activity eased in February, which further boosts investors’ sentiment and should contribute to keeping a lid on the Comex Gold price.
(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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