Gold prices reached unprecedented levels on the Multi-Commodity Exchange (MCX) on September 23, 2023, hitting a peak of Rs. 1,12,419 per 10 grams. This marks a significant increase of 47% year-to-date, driven by strong domestic demand and global economic factors. The surge reflects ongoing concerns over trade tariffs and geopolitical risks, alongside aggressive central bank purchases.
In the Indian market, MCX Gold October futures traded 0.15% higher at Rs. 1,12,397 per 10 grams after briefly reaching the record high. In contrast, MCX Silver December futures saw a slight decline of 0.12%, settling at Rs. 1,33,389 per kilogram. The rising demand is particularly evident as consumers prepare for the upcoming festive season, contributing to the upward momentum in gold prices.
Global Influences and Market Dynamics
Internationally, gold has also seen a boost, with spot prices climbing 0.2% to $3,752.43 per ounce. Earlier in the session, it peaked at $3,758.03. US gold futures for December delivery rose 0.3% to $3,787.60. The decline of the US dollar index to 97.20, down 0.10%, has made gold a more attractive investment for overseas buyers, further enhancing its demand.
The market is being influenced by the 25-basis-point rate cut by the US Federal Reserve and expectations of further easing, which have contributed to the bullish sentiment surrounding gold. Additionally, strong retail buying in advance of the festive season has played a key role in driving up prices.
Expert Insights and Future Predictions
Analysts are optimistic about gold’s trajectory. Rahul Kalantri, from Mehta Equities, notes that gold is well-supported by central bank purchases and robust inflows into Exchange-Traded Funds (ETFs). He identifies domestic support levels for gold ranging from Rs. 1,11,670 to Rs. 1,11,380, with resistance levels at Rs. 1,12,650 to Rs. 1,12,900.
Investment strategies are being suggested by experts like Manoj Kumar Jain from Prithvifinmart Commodity Research, who recommends buying gold around Rs. 1,11,800, with a stop loss set at Rs. 1,11,180 and a target of Rs. 1,13,000. For silver, he advises an entry point of approximately Rs. 1,32,500, targeting Rs. 1,35,000.
The festive season is expected to drive even stronger demand, with many investors reluctant to book profits at current high levels. This sentiment is likely to maintain upward pressure on prices as the market continues to react to global economic developments.
Overall, the current landscape for gold is marked by a combination of domestic and international factors that are propelling prices to record heights, illustrating the metal’s ongoing appeal as a safe-haven asset amid economic uncertainty.
