Global gold prices soared to a new high on Wednesday (October 30) as investor caution ahead of the US election buoyed demand for the precious metal. Spot gold increased 0.1% to $2,778.27 per ounce, peaking at a record $2,778.79 during early trading.
This historic high reflects rising bullish sentiment fueled by political and economic uncertainties, with analysts pointing to a firm upward trend in bullion as US economic data unfolds.
US election jitters boost global gold prices
The nearing US election, with polls indicating a tight race, has intensified gold demand as investors seek safe-haven assets. Recent US data presented a mixed economic picture.
Job openings reached a three-and-a-half-year low in September, signaling a cooling labor market.
Conversely, consumer confidence climbed to 108.7 in October, hitting a nine-month peak.
As a result, the Federal Reserve is expected to announce another interest rate reduction next week.
This will support gold’s appeal, given its strength in low-interest environments.
Indian gold prices surge amid festival buying
In India, gold prices mirrored the global trend.
On October 30, 2024, 24-carat gold (10 grams) traded at ₹80,450, while 22-carat gold was priced at ₹73,750, with rates rising by ₹650 and ₹600, respectively, over the past 24 hours.
These increases align with the festive demand for Dhanteras and Diwali, when gold purchases are traditional and auspicious.
The Indian market saw a 37% increase in gold prices over the past year, spurred by currency fluctuations and geopolitical tensions.
Jateen Trivedi, Vice President of Research – Commodity and Currency at LKP Securities, commented, “Gold prices in MCX remained positive, with Dhanteras encouraging long positions. More buying occurred on this auspicious day, driving prices above ₹80,000 in the jewelry market.”
Trivedi added that upcoming US data, including Non-Farm Payrolls and unemployment figures, could impact gold movements, with major support levels around ₹77,000 per ounce and resistance at ₹81,500 per ounce.
ETF holdings, yield trends and outlook
Gold’s rally was further supported by increasing ETF holdings, which reached 84.105 million ounces as of October 25, marking the second consecutive weekly rise.
While US bond yields have hit fresh highs, investors remain largely focused on election uncertainties, dismissing yield pressures.
The rising 10-year US bond yield at 4.31% has not deterred gold’s upward momentum, though analysts suggest the metal may face some choppy trading as yields and the dollar firm up.
Praveen Singh, Associate Vice President for Fundamental Currencies and Commodities at Sharekhan by BNP Paribas, stated, “Gold is ignoring the yield and dollar index trends as traders anticipate a potential rise in the US deficit post-election. While the metal appears somewhat overbought, dip buying remains the preferred strategy, with a near-term target of $2,800 per ounce and support levels at $2,750/$2,715 per ounce.”
Investment strategy amid high prices
Investors continue to view gold as a hedge against economic and political instability.
While prices may face short-term corrections, experts believe demand for gold will remain strong.
Given the high prices, strategies such as staggered investments or buying on dips are recommended.
Content retrieved from: https://www.cnbctv18.com/personal-finance/gold-rates-india-prices-all-time-high-diwali-dhanteras-when-to-buy-dips-19501259.htm.
