Most recent article: India Gold price Wednesday: Gold rises further, according to MCX data
Gold prices rose in India on Friday, according to data from India's Multi Commodity Exchange (MCX).
Gold price stood at 62,439 Indian Rupees (INR) per 10 grams, up INR 258 compared with the INR 62,181 it cost on Thursday.
As for futures contracts, Gold prices increased to INR 62,516 per 10 gms from INR 62,223 per 10 gms.
Prices for Silver futures contracts decreased to INR 75,768 per kg from INR 75,457 per kg.
| Major Indian city | Gold Price |
|---|---|
| Ahmedabad | 64,660 |
| Mumbai | 64,430 |
| New Delhi | 64,560 |
| Chennai | 64,660 |
| Kolkata | 64,600 |
Daily Digest Market Movers: Comex Gold price flirts with multi-week high amid Fed rate cut bets, ahead of US PCE data
- Expectations for an imminent shift in the Federal Reserve's policy stance lift the Comex Gold price to its highest since December 4 on the last day of the week.
- A slew of Fed officials recently tried to push back against the idea of rapid interest rate cuts next year, though failed to change investor sentiment.
- The CME Group's FedWatch Tool indicates a greater chance of a Fed rate cut move by March 2024 and 150 bps of cumulative cuts by the year-end.
- The bets were reaffirmed by data showing that the US economy grew by a 4.9% annualized pace in the third quarter vs. the 5.2% rise previously reported.
- The Labor Department reported that Initial Jobless Claims increased to 205,000 during the week ended December 16 and remained at historically low levels.
- The benchmark 10-year US Treasury bond yield hovers near its lowest level since July, while the US Dollar recovers a bid from a five-month through.
- This, along with the prospect of a global rate-cutting cycle, might continue to benefit the non-yielding yellow metal and favour bullish traders.
- A plunge in UK inflation during November, to its lowest rate in over two years, raised hopes that the Bank of England will start cutting rates in the first half of 2024.
- Adding to this, the recent run of softer inflation data from the Eurozone suggests that the risk is towards earlier rate cuts by the European Central Bank.
- The US Core Personal Consumption Expenditure (PCE) Price Index could offer cues about the Fed's policy outlook and provide a fresh impetus to the XAU/USD.
(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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