Gold prices in India, along with the international market are expected to rise in December, due to aggressive inflationary concerns, until the US Federal Reserve starts to hike the interest rate. Gold rates have gained by Rs. 440/ 10 grams today in the domestic markets. Today, on December 16, 22 carat gold rates are quoted at Rs. 47,350/10 grams and 24 carat gold rates are quoted at Rs. 48,350/10 grams in India. In Chennai, Kolkata, and Bangalore, gold prices have gained up to Rs. 300/ 10 grams today.
Inflation and unemployment, are two major factors behind the surge in gold prices, globally. Reappointed Fed Chairman Jerome Powell yesterday gave his official statement, "The unemployment rate [is projected] to decline to 3.5% by the end of the year...while inflation will run above our 2% goal well into next year. Price increases have now spread to a broader range of goods and services. We are making rapid progress towards maximum employment." If the Fed succeeds to do that, gold rates can fall.
Additionally, The Fed is also looking out to increase wages to improve the economic outlook of the country. An augmenting economy generally pulls the gold rates down, along with other precious asset classes. With the Fed's adequate measures to enhance the supply chain and manufacturing sector, wages can hike. So, the economic development will gain pace, and gold rates can drop. But for the time being, high inflationary concerns are increasing the gold rates in the international markets.
On the other hand, the US Fed had indicated to hike the interest rate in the country 3 times in 2022, 3 times in 2023, and 2 times in 2024. According to sources, the interest rate hike will be ¼% or 25 basis points, which is a comparatively aggressive timeline for rate hikes. Until the interest rate hike, the gold market will be surrounded by inflationary concerns. In addition to that, the US Dollar index has also fallen in the spot market today. So, the rates will surge in the Indian markets, in line with the global trend.
Gold rates are quoted differently, daily. Today's gold rates in major Indian cities follow:
|City||22 carat (INR/10 Grams)||24 carat (INR/10 Grams)|
Today the Comex gold futures gained only by 1.18% and were quoted at $1783.4/oz, while the spot gold prices surged by 0.51%, and were quoted at $1787.3/oz till last traded. Yesterday Comex gold futures closed at $1762.6/oz. Additionally, the US dollar index in the spot market went to 96.18, falling by 0.21%. Mirroring the same global gold rate trend, in India, the Mumbai MCX gold in February future quoted at Rs. 48,347/10 grams, gained only by 0.54%, till last traded.