Gold prices in India continue to be volatile, so much so that the precious metal has dipped by approximately 2% from its all-time highs. Going ahead, on Friday, the highly anticipated US August Employment report scheduled later in the day will set the tone for the yellow metal, since it will give further clarity on the quantum of rate cut by the Federal Reserve in its upcoming policy. Lowering interest rates is a key positive for gold since dollar losses shine. When the dollar is down, overseas investors prefer non-yielding assets like gold.
Gold Price In India:
Currently, 22K gold is at Rs 66,680 per 10 grams, while 24K of 10 grams is just Rs 250 away from touching the Rs 73,000 mark, as it is priced at Rs 72,750. Meanwhile, 18K of 10 grams is at Rs 54,550.
MCX Gold Price, Silver Price:
MCX gold futures with October expiry ended at Rs 71,948 per 10 grams, up marginally on September 5, 2024, after hitting an intraday high of Rs 72,120.
While MCX silver futures with December expiry almost reached near its Rs 86,000 per 1kg, as it touched an intraday high of Rs 85,945 per 1kg on September 5. After market hours, the price ended at Rs 85,026 per 1kg.
Gold Prices In Cities:
At present, gold prices in 10 grams of 24K are at Rs 72,750 in cities like Chennai, Mumbai, Kolkata, Hyderabad, Kerala, and Pune. While the price was much higher at Rs 72,900 in 24K per 10 grams in Delhi and was at Rs 72,800 in Vadodara and Ahmedabad. The city of Bangalore had the cheapest gold in 24K of 10 grams to Rs 72,740.
Gold Prices In Other Countries:
In the souk market aka Dubai, 24K gold stood at AED3,045, which is priced at Rs 69,621 in Indian rupees. Further, in the United States, at the retail stores, gold price was at $810 in 24K/10 grams, which is even more cheaper than Rs 68,024.
Moreover, 24K/10 grams is available at SGD1,127 which is Rs 72,813 in Singapore. In the United Arab Emirates (UAE), the same precious metal is at AED3,045 which is Rs 69,621 in terms of rupee. Also, in Malaysia, the gold price is MYR3,580, which is priced at Rs 69,307 per 10 grams.
Moving on, spot gold is currently above $2,516 per ounce, and that of US gold futures with December expiry was more than $2,546 per ounce.
Gold Price Outlook:
Prithviraj Kothari, Managing Director of RiddiSiddhi Bullions Limited (RSBL) said, gold prices have fallen about 2% from their all-time high, as market sentiment remained negative following the worldwide sell-off prompted by the announcement of weak US manufacturing data on Tuesday and concerns about the AI tech bubble collapsing. Investors will be keenly watching the highly anticipated US August Employment report on Friday, which might influence the size and pace of a potential rate cut at the Federal Reserve's September policy meeting. However, growing Middle Eastern geopolitical tensions and greater Fed rate-cut predictions may bolster gold prices moving ahead.
Further, prices will react after the release of US ADP Nonfarm payroll change data. As per Trading Economics, Private businesses in the US added 99K workers to their payrolls in August 2024, the lowest number since January 2021, following a downwardly revised 111K in July and well below forecasts of 145K. Figures showed the labour market continued to cool for the fifth straight month while wage growth was stable. Also, it cited Nela Richardson, chief economist, at ADP who said, "The job market's downward drift brought us to slower-than-normal hiring after two years of outsized growth."
Giving a technical view, FX Street in its latest report said, the psychological $2500 level marks solid support, guarding a lower trigger at $2470, while $2531 marks an upper pivot, violation of which to spark fresh acceleration into uncharted territory.
In addition, the World Gold Council in its latest report said, as per its Gold Return Attribution Model (GRAM), gold was pulled higher by a material drop in the US dollar and, to a lesser extent, lower 10-year Treasury yields as the Fed signalled the time had come for rate cuts. Following a strong monthly increase in July, gold posted another healthy gain in August to finish 3.6% higher at US$2,513/oz. It also reached a new all-time on 20 August before a very marginal decline into month end.
WGC's note further said, "Also of note in August, the significant cut in import duty on gold in India, which took place in late July, has been a shot in the arm for gold demand in the country. Anecdotal reports suggest the duty reduction was followed by strong buying interest from jewellery retailers as well as consumers. Meanwhile, global physically-backed gold ETFs extended their inflow streak to four months. Western funds once again contributed the lion's share of flows.
In the near term, WGC said, the current macro environment is tough to read due to the swirl of contradictory economic data releases. Also, arguably the pivotal US election is adding to the uncertainty and has likely fostered an increase in investors expressing their view through options markets. The council added that gold 'spreading' positions in options, a normally quieter corner of the gold market, are at a multi-year high, suggesting that investors are either hedging or speculating on both a rate-cutting cycle and the outcome of the US election.
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