Gold prices on the Multi Commodity Exchange of India (MCX) traded half a percent higher on Friday, tracking gains in international bullion prices on rising expectations of an interest rate cut by the US Federal Reserve next month.
MCX gold rate for February expiry traded higher by ₹647, or 0.51%, at ₹1,28,314 per 10 grams. It hit an intraday high of ₹1,28,450 level. MCX silver price traded higher by ₹1,485, or 0.89%, at ₹1,67,472 per kg.
In the international market, gold prices were poised for a fourth straight monthly rise, bolstered by investor optimism that the US Fed would cut interest rates in its December policy meeting.
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Spot gold price rose 0.8% to $4,189.61 per ounce, hitting its highest since November 14, and was set for a 3% weekly gain. Bullion is set to register a 3.9% rise this month. US gold futures for December delivery were up 0.5% at $4,221.30 per ounce. Spot silver price rose 1.4% to $54.18 per ounce.
“Geopolitical tensions, inflation fears, and central-bank gold-buying have driven global bullion demand, boosting gold’s appeal as a ‘safe asset’. In India, festivals and weddings often push demand — which tends to lift prices. With economic uncertainties globally — inflation, currency fluctuations, rate-cut expectations — gold remains attractive for investors seeking stability and long-term value preservation,” said Jigar Trivedi, Senior Research Analyst at Reliance Securities.
Is it the right time to buy gold?
Analysts expect gold prices to see further upside going forward on rising bets of three additional US Fed rate cuts by the end of 2026. Non-yielding gold tends to perform well in low-interest-rate environments.
Comments from San Francisco Federal Reserve Bank President Mary Daly and Fed Governor Christopher Waller this week have also bolstered expectations for a rate cut next month, Reuters reported.
US rate futures are pricing in an 87% chance of a rate cut in December, compared with 85% a day prior and 50% a week before, according to the CME’s FedWatch tool.
Also Read | Gold prices today: Check 24-karat and 22-karat rates in your city on 28 November
Meanwhile, the US dollar was headed for its worst week since late July. A weaker greenback makes dollar-priced gold more attractive for buyers using other currencies.
However, optimism surrounding the US-led Russia–Ukraine peace plan is likely to cap further upside in gold prices.
Trivedi expects gold prices to remain strong or even rise further, given continued safe-haven demand and potential macro-economic triggers.
“Thus, if the goal is long-term preservation of wealth or a hedge against inflation and volatility — rather than trying to ‘time the bottom’ — buying gold now can be a reasonable decision. We recommend going long in the December month,” said Trivedi.
According to him, ₹1,30,000 per 10 grams is near term resistance, while a strong support lies near ₹1,26,000 level.
“We recommend going long in December for target ₹1,30,000 per 10 grams with a stop loss near ₹1,27,000 per 10 grams,” said Trivedi.
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Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
