Gold rate today: Because of increased expectations for a US Fed rate cut and weakening in US dollar rates, gold prices in the international market reached a six-week high of $2,391 per ounce. The gold futures contract on the Multi Commodity Exchange (MCX) for August 2024 has recaptured the psychological ₹73,000 mark, with a weekly rise of roughly 2% in the preceding week. On Friday, the MCX gold rate increased by ₹671 per 10 gm and ended at ₹73,038.
According to commodity market specialists, the gold rate is now rising due to the widely anticipated US Fed rate decrease at the upcoming US Fed meeting, which has weakened the US dollar rate in the FX market. A fall in the US Federal Reserve’s interest rate often results in a weaker US currency, making gold more appealing to investors. They claimed that lowering US inflation concerns, following better-than-expected US job data and the lowest yearly increase in more than three years, have boosted the gold price gain in recent days.
Triggers for the Gold Price Rally
Anuj Gupta, Head of Commodity & Currency at HDFC Securities, stated that gold prices in the worldwide market have risen to a six-week high, while silver rates have reached a four-week high. This is possible given that softening US inflation concerns have fueled speculation about Fed rate cuts. This growing optimism about the US Fed rate decrease placed pressure on the US dollar rate in the Forex market, and the US dollar index fell below the 105 level.”
Sugandha Sachdeva, Founder of SS WealthStreet, pointed to other triggers that are driving gold rates today, saying, “Gold prices advanced by more than 2 percent in the week gone by as rising optimism for an interest rate cut by the US Federal Reserve sooner than previously anticipated, weakened the dollar index, and acted as a catalyst for a strong rebound in gold prices. Recent US core PCE index data, a key inflation barometer, showed the lowest yearly growth in three years. This signaled easing economic price pressures and enhanced the chance that the US central bank will begin to decrease interest rates at its September meeting.”
According to an SS WealthStreet expert, gold prices rose further towards the end of the week as the US economy added 206,000 jobs in June, exceeding estimates. Unemployment climbed to 4.1%, the highest level since November 2021, while wage growth slowed. Furthermore, employment growth for April and May was revised lower, signaling a cooling labor market and slowing inflation, causing the dollar index to fall further and tempting buyers to seek out dollar-denominated gold.
Today’s gold price: Important levels to watch
The price structure indicates that the precious metal has found excellent support around Rs.70700 and then at ₹72,200 per 10 gm mark and looks to continue with the upward trend towards ₹73,700 and ₹74,200 per 10 gm zone or around $2,420 per ounce mark in the coming days,” according to Sugandha.
Factors that may influence gold price
Speaking on the immediate catalysts that may influence gold prices in the near term, Sugandha Sachdeva stated, “All eyes are now on the US Consumer Price Index (CPI) data for June, which is set to be released next week. This data will have an even greater impact on the US Federal Reserve’s rate-cutting path, and thus on gold prices.
