Gold Prices In India: 24-Carat’s Weekly Rise By Rs 1,060 Per 10 Grams; Will Yellow Metal Continue To Shine?
Gold prices in India witnessed a fruitful week despite a sluggish start with 24-carat of this pristine metal rising by a whopping Rs 1,000 from March 18th to 23rd
Notably, this week also saw gold prices hit an all-time high before correcting as investors booked profits at the end of the week. Gold prices are likely to continue the momentum upside, thanks to the Fed’s retaining its outlook for three rate cuts in 2024 ahead.
Gold Prices In India:
On March 23, 22-carat gold of 10 grams stood at Rs 61,250, while 100 grams of gold was at Rs 6,12,500. Also, 1-gram and 8-gram of gold stood at Rs 6,125 and Rs 49,000 respectively.
Meanwhile, gold prices of 24-carat were at Rs 66,820 for 10 grams, Rs 6,68,200 for 100 grams, Rs 53,456 for 8 grams, and Rs 6,682 for 1 gram.
However, during the trading week from March 18 to 22nd, 24-carat gold prices surged by a whopping Rs 1,060 in 10-gram, and that of 22-carat soared by Rs 970.
On March 22nd, the prices of yellow metal stood at Rs 61,350 in 22-carat, and at Rs 66,930 in 24-carat per 10 gram. At the start of the trading week, 10 grams of 22-carat was at Rs 60,380, and 24-carat of the same was at Rs 65,870.
Yellow metal saw its biggest jump in history on March 21, right after the FOMC monetary policy. On this day, 22-carat and 24-carat were at an all-time high of Rs 61,800 and Rs 67,420 per 10 grams.
Jateen Trivedi, VP Research Analyst, LKP Securities said that gold prices experienced a correction over the last two days, influenced by a rise in the dollar index and profit booking following a strong bullish rally in March, which saw prices climb from 63000 to 66900.”
Trivedi added, “Despite this correction, the overall outlook for gold remains positive. However, some volatility and further correction may be expected in the near term. Gold is anticipated to trade within a range of 65250-66500.”
Also, Dr. Joseph Thomas, Head of Research, Emkay Wealth Management said, “The price of gold has been moving more or less in line with the expectations on the trajectory of US interest rates.
That the Fed is likely to cut rates two or three times during this CY may lend more strength to gold mainly due to the potential for Dollar depreciation after a rate cut. Gold will have limited downside from the current levels and US$2050/60 will be a strong support.”
Earlier this week, the US Federal Reserve maintained key fund rates at their highest level since 2001, for the fifth consecutive monetary policy meeting on March 20. Amidst finding inflation still sticky, the trajectory of rate cuts in 2024 has soothed investors’ sentiment as lowering rates is stimulative for both economy and market-related instruments like stocks.
Keeping its goals of achieving maximum employment and inflation at the rate of 2% for the longer run, the US Fed decided to maintain the target range for the federal funds rate at 5-1/4 to 5-1/2 per cent. Fed pointed out that the latest indicators in the US suggest that economic activity has been expanding at a solid pace. Job gains have remained strong, and the unemployment rate has remained low. However, it said, “Inflation has eased over the past year but remains elevated, as per FOMC.”
Also, FOMC led by chair Jerome Powell continues to expect three rate cuts of 25 basis points each in 2024, however, the trajectory for lowering rates is fewer for 2025.
During rate cuts, non-yielding assets like gold become attractive among overseas investors against other foreign currencies. This is because dollar and bond yields tend to take a slippery slope in the rate-cut scenario.
Pooja Jaiswar Goodreturns
source: goodreturns.in
