Gold prices down around 9% from peak, experts suggest support at this level
Gold Prices Recover Slightly After Six-Day Drop
On Monday, international gold prices saw a modest recovery, ending a six-day losing streak. However, they remain about 9% lower than their recent peaks. Currently, gold is trading at USD 2,597 per ounce, down from a peak of USD 2,790. In India, gold on the Multi Commodity Exchange is priced at Rs 74,657 per 10 gm, showing a 1% intraday increase but still below its peak of Rs 80,000.
Market Influences
Mumbai-based Kedia Advisory noted that despite the slight gains, expectations of less aggressive US Federal Reserve rate cuts and high US bond yields are limiting further increases. They highlighted that USD 2,536 is a key support level. Geopolitical tensions, such as conflicts in Ukraine and Gaza, have increased demand for gold as a safe haven, but strong US economic data and a hawkish Federal Reserve are affecting bullish sentiment.
Future Outlook
Gold has risen over 24% this year, driven by the US Fed's easing cycle, central bank purchases, and geopolitical risks. However, it is currently near a two-month low and facing its worst week since June 2021. Colin Shah, MD of Kama Jewelry, mentioned that the price drop is beneficial for Indian buyers during the wedding season. He expects prices to stabilize in the short to medium term and recover as geopolitical tensions ease and interest rates are adjusted by the US Fed and RBI by 2025.
Doubts Revealed
Gold Prices
Gold prices refer to the cost of buying gold, which can change based on various factors like demand, supply, and global events.
Global Tensions
Global tensions are conflicts or disagreements between countries that can affect economies and markets worldwide, including the price of gold.
USD 2,597 per ounce
This means that one ounce of gold is being sold for 2,597 US dollars. An ounce is a unit of weight used to measure precious metals.
Rs 74,657 per 10 gm
In India, gold is priced at 74,657 rupees for every 10 grams. Grams are a metric unit of weight.
Kedia Advisory
Kedia Advisory is a company or group that provides advice on financial markets, including gold prices.
US bond yields
US bond yields are the interest rates earned by investors who buy US government bonds. High yields can make gold less attractive as an investment.
Fed rate cuts
Fed rate cuts refer to the US Federal Reserve lowering interest rates, which can influence economic activity and investment decisions.
Colin Shah
Colin Shah is a person associated with Kama Jewelry, likely an expert or leader in the jewelry industry.
Kama Jewelry
Kama Jewelry is a company that designs and sells jewelry, and its experts provide insights on gold prices.
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