Gold rate today: Yellow metal remains elevated as easing US inflation fuels US Fed rate cut buzz

Gold rate today: The release of the US CPI data significantly impacted gold prices, leading to a continued rally on Friday last week. The MCX gold rate closed higher at ₹76,307 per 10 gm, while the spot gold price surged over one per cent to $2,657.26 per ounce. The COMEX gold price also saw a 1.32% increase, closing at $2,674.20 per troy ounce. This surge was attributed to the easing of US inflation concerns, as indicated by the US CPI data, and the subsequent speculation of a 25-basis-point interest rate cut in the next month's US Fed meeting.

US inflation data in focus

Highlighting the role of US inflation in shaping gold prices, Anuj Gupta, Head of Commodity & Currency at HDFC Securities, explained, "The US CPI data released on Thursday was in line with the market expectations. While US consumer prices were slightly higher than the market estimates in September, the annual US inflation growth is the smallest in the last three and a half years. This has significantly eased the US inflation pressure on the US economy, triggering US Fed rate cut buzz in the upcoming US Fed meeting."

Several factors contribute to the ongoing positive trend in gold prices. As Jateen Trivedi, VP Research Analyst—Commodity and Currency at LKP Securities, pointed out, these include US data that supports the continuation of interest rate cuts, particularly due to high jobless claims and elevated crude oil prices, which indicate persistent inflationary pressures.

"Fundamentally, gold has been influenced by global macroeconomic conditions, particularly the US dollar strength and bond yields. The US Federal Reserve's stance on interest rates continues to weigh heavily. If there is any shift in economic data indicating a softening US economy, gold may see safe-haven demand, pushing prices higher," said Ameya Ranadive, Senior Technical Analyst at StoxBox.

Israel-Iran war

Geopolitical tensions like the Israel-Iran war can significantly impact gold prices. As the StoxBox expert pointed out, any escalation in such tensions, like the recent Israel-Palestine conflict, can lead to a surge in gold prices as investors seek safe assets. Therefore, monitoring Middle East developments and any shocks to oil prices is crucial, as these could indirectly affect gold demand.

Gold rate today: Important levels to watch

"In the international market, spot gold price today is in the $2,640 to $2,700 per troy ounce range whereas MCX gold rate has breached the hurdle placed at ₹76,200 to ₹76,250 after closing above ₹76,300 mark. However, the weakness in the Indian National Rupee against the US dollar (USD) is also a reason for the rise in gold prices in the domestic market. We can now expect the MCX gold rate to touch ₹78,000 per 10 gm by Diwali 2024 if there is no breakthrough in the Middle East tension," said Amnuj Gupta of HDFC Securities.

Gold rate today in Delhi

Gold prices in Delhi jumped by ₹1,150 to ₹78,500 per 10 gm, hovering near all-time high levels, in the national capital on Friday on fresh buying from jewellers amid a positive trend globally, according to the All India Sarafa Association. The precious metal of 99.9 per cent purity had closed at ₹77,350 per 10 gm on Thursday.

Disclaimer: The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and individual circumstances may vary.