Gold Price: Gold prices have reached a new height. Gold has gone up to $ 3,698 an ounce in the international market. At the same time, it is around Rs 1,09,511 per 10 grams in India. Experts say that there are many reasons for both domestic and global reasons behind this fast.
Weak rupee and festivals demand
Gold prices in India have increased rapidly as the rupee fall has made import costs expensive. Apart from this, the festival and wedding season starts, due to which demand has also increased.
Former National President of the Indian Bullion Jewelers Association (IBJA) and CEO of Aspect Global Ventures, Mohit Kamboj says, “Investors are considering gold as a safe hedge. However, when gold goes above Rs 1.10 lakh per 10 grams, the possibility of profit booking also increases due to festivals and weddings.
Weak dollar and decreasing yield
The gold rally is also getting support from currency and bond markets. Manav Modi, analyst of Motilal Oswal Financial Services, Manav Modi said, “Gold is at a record high due to weak dollars and a decline in American yields.” The dollar is currently at a two -and -a -half -month low against the euro and the US bond yield remains close to 4%.
Expectations from Fed Policy
The market hopes that Federal Reserve (Federal Reserve) will cut interest rates after a long time by 25 basis points. Political pressure on the fed has also increased. US President Donald Trump has demanded a ‘big’ rate deduction from Fed. Modi said, “This time not only the statement of Governor Powell, but the dot plot and economic estimates will also be important.”
The dot plot is a chart of the American Federal Reserve, in which every member explains at what level the interest rates can live in future.
Geophysical stress
The ongoing struggle in the Middle East is also strengthening gold. The Israeli army has launched a ground attack in Gaza City. This has increased the risk of crude oil supply chain. At the same time, Russia and Ukraine War are not expected to stop at the moment. Usually, investors turn to gold as a safe option in such circumstances.