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Gold Price in India Today: Gold rises according to FXStreet data

The prices of Gold rose in India on Thursday, according to data compiled by FXStreet.

The price of Gold stood at INR 6,294.29 per gram, compared to INR 6,257.45 on Wednesday.

Gold price increased to INR 73,415.39 per tola from INR 72,985.62 per tola the previous day.

Unit of measurement Gold price in INR
1 Gram 6,294.29
10 Grams 62,942.92
Tola 73,415.39
Troy Ounce 195,776.20

FXStreet calculates Gold prices in India by adapting international prices (USD/INR) to the local currency and units of measurement. Prices are updated daily based on market rates taken at the time of publication. Prices are for reference only and local rates may differ slightly.

Drivers of world markets: The price of Gold on Comex is at weekly highs despite the rebound in the USD

  • Uncertainty over when the Federal Reserve will begin cutting interest rates is keeping traders on the sidelines and leading to range-bound price action around the price of Gold.
  • The Fed projected just one interest rate cut this year compared to three projected in March, acting as a tailwind for US Treasury yields and capping the non-yielding yellow metal’s upside. .
  • US retail sales data released on Tuesday pointed to lackluster economic activity, which, coupled with weaker consumer and producer prices in the US, should allow the Fed to ease monetary policy soon.
  • Current market pricing indicates a higher probability of the first rate cut in September and the possibility of a further cut in November or December, offering some support to the XAU/USD.
  • Ukrainian drone attacks on Russian energy infrastructure and Israel’s warning that an all-out war with Iran-backed Hezbollah is looming soon point to growing geopolitical risk in Europe and the Middle East.
  • Added to this are concerns that a new government in France could weaken fiscal discipline, which acts as a tailwind for safe-haven assets and should help limit any significant decline in the commodity.
  • Investors now await the decision from the Swiss National Bank (SNB) and the crucial monetary policy meeting from the Bank of England (BoE), which could infuse volatility and provide some boost to the metal.
  • Traders will also take cues from the US economic agenda, which includes the release of weekly initial jobless claims, the Philadelphia Fed manufacturing index, building permits and housing starts.

Gold

Gold has played a fundamental role in human history, as it has been widely used as a store of value and medium of exchange. Today, apart from its brilliance and use for jewelry, the precious metal is considered a safe haven asset, meaning it is considered a good investment in turbulent times. Gold is also considered a hedge against inflation and currency depreciation, since it does not depend on any specific issuer or government.

Central banks are the largest holders of Gold. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and purchase Gold to improve the perception of strength of the economy and currency. High Gold reserves can be a source of confidence for the solvency of a country. Central banks added 1,136 tons of gold worth about $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the largest annual purchase since records exist. Central banks in emerging economies such as China, India and Türkiye are rapidly increasing their gold reserves.

Gold has an inverse correlation with the US Dollar and US Treasuries, which are the main reserve and safe haven assets. When the Dollar depreciates, the price of Gold tends to rise, allowing 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 the price of Gold, while sell-offs in riskier markets tend to favor the precious metal.

The price of Gold can move due to a wide range of factors. Geopolitical instability or fear of a deep recession can cause the price of Gold to rise rapidly due to its status as a safe haven asset. As a non-yielding asset, the price of Gold tends to rise when interest rates fall, while rising money prices tend to weigh down the yellow metal. Still, most of the moves depend on how the US Dollar (USD) performs, as the asset is traded in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold in check, while a weaker Dollar is likely to push up Gold prices.

(An automation tool was used to create this post.)

Source: Fx Street

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