Most recent article: India Gold price today: Gold extends upside, according to MCX data
Gold prices rose in India on Tuesday, according to data from India's Multi Commodity Exchange (MCX).
Gold price stood at 61,846 Indian Rupees (INR) per 10 grams, up INR 146 compared with the INR 61,700 it cost on Monday.
As for futures contracts, Gold prices decreased to INR 62,214 per 10 gms from INR 62,291 per 10 gms.
Prices for Silver futures contracts decreased to INR 74,582 per kg from INR 74,410 per kg.
| Major Indian city | Gold Price |
|---|---|
| Ahmedabad | 64,050 |
| Mumbai | 63,800 |
| New Delhi | 63,870 |
| Chennai | 64,020 |
| Kolkata | 63,970 |
Global Market Movers: Comex Gold price struggles to gain any meaningful traction
- Chicago Federal Reserve President Austan Goolsbee, along with Cleveland Fed President Loretta Mester, pushed back against market bets on interest rate cuts on Monday.
- Goolsbee said that he was confused over the market reaction to last week's FOMC meeting and that the central bank is not precommiting to cutting rates soon and swiftly.
- Separately, Cleveland Fed President Loretta Mester noted that financial markets had gotten a little bit ahead of the central bank on when to expect interest rate cuts next year.
- This comes on the back of New York Fed President John Williams's remarks on Friday that it was premature to speculate about rate cuts and caps the upside for the Comex Gold price.
- The markets, however, seem convinced that the Fed will pivot to easing by the first half of 2024, which continues to undermine the US Dollar and lends support to the metal.
- Concerns over geopolitical risks linked to the conflict in the Middle East should further contribute to limiting any meaningful downfall for the safe-haven precious metal.
- Yemen's Iran-aligned Houthi militants launched a series of drone and missile attacks on ships in the southern Red Sea, which it says are a response to Israel's assault on the Gaza Strip.
- US Defence Secretary Lloyd Austin announced the formation of a multinational coalition and the launch of Operation Prosperity Guardian to address the Houthi threat in the Red Sea.
- Investors now look forward to the US Core Personal Consumption Expenditure (PCE) Price Index on Friday for clues about the Fed's future policy decisions.
(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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