Gold prices reached a record high of $2,758.37/ounce in October 2024.
In India, gold prices surged to ₹7,513.37/gram, a 40% increase year-over-year.
The upcoming festive season is expected to further boost demand for gold.
Factors Influencing Gold Prices:
Gold is considered a safe-haven asset, especially during times of economic uncertainty and geopolitical tensions.
Lower interest rates can make gold more attractive as an investment.
Central banks have been increasing their gold reserves, further driving demand.
The finite supply of gold and fluctuations in demand can impact prices.
The value of the US dollar can influence gold prices, as gold is priced in US dollars.
Domestic Demand Dynamics:
The festive and wedding seasons drive significant demand for gold in India.
The government's decision to reduce import duties on gold has boosted demand.
Improved rural incomes due to favorable monsoons are expected to increase gold purchases.
Future Outlook
Prices may continue to rise, potentially reaching $2,800 to $3,000/ounce in the next year.
Strong price performance is driving investment demand for gold.
The combination of festive season, reduced import duties, and improved rural incomes is expected to sustain strong domestic demand.
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