Indian Gold Rate Revives To Rs. 4720, Global Gold Rate At US$ 1,772/oz, Want To Buy?

Gold is considered a hedge against inflation and investors prefer this metal for long-term investment due to its high return history. This week, gold rates in India have revived significantly, after showing a bearish trend for a few days. The gold market surged by around Rs. 800 in the past three days, even after an interest rate hike by the US Fed. The US central bank has hiked its interest rate by 75bps to control the climbing inflation rate, which should have been negative for the gold market. However, gold reacted positively because this level of a rate hike was expected by the investors. The market absorbed the hike and in the international futures market, gold rates reached 1,772.50/oz. Impacting similarly in India, 22-carat gold rates today stood at Rs. 47200/10 grams, and 24-carat gold rates stood at around Rs. 51,490/10 grams.

Additionally, the US Dollar index has also softened marginally this week, which has helped the commodity markets to boom. A falling US Dollar index is positive for gold rates because the yellow metal is a dollar-dominated asset class.

Today, the Comex gold futures were quoted at $1,772.50/oz, gaining by 0.76%, from the last trading day. Yesterday it was last quoted at $1,759/oz. The yellow metal fell by 3.64% this year in the futures market. The spot gold prices were last quoted at $1767.50/oz, gaining by 0.55%, from the last trading day. The US Dollar index was quoted at 105.87. In India, the Mumbai Commodity Exchange (MCX) gold in October future was quoted at Rs. 51605/10 grams, surging by 0.31%, from the last trading day.

However, on the present status of the gold market, analyst Phillip Streible commented to Kitco News, "The drivers that affect Gold most are currency fluctuations, economics, geopolitics, growth, and inflation. I believe equities will continue to see earnings guidance decline for the rest of the year. Therefore, I recommend being nimble on these bare market bounces and reducing exposure until the Fed finishes tightening and reducing exposure to Gold in the monthly resistance zone."