Gold rate today ₹1850 away from record high. Will it climb to a new peak this week?

Gold rate today: Making their best weekly performance since March 2024, gold prices finished around 5 per cent higher at ₹77,685 per 10 gm on Friday, just ₹1850 away from the record high of ₹79,535. The rally in MCX gold rates was mainly fueled by an escalation in the Russia-Ukraine war. In addition to this geopolitical tension, Uncertainty around the US economy after Donald Trump’s victory in the US Presidential Elections is also driving the safe-haven flows into gold.

According to commodity market experts, gold prices are rising for three reasons: escalation in the Russia-Ukraine war, volatile stock market and Uncertainty around the US economy after the victory of Donald Trump in the US Presidential Elections. However, they said that the rising US dollar and the US Fed signalling a cautious approach to rate cuts are acting as headwinds. They noted that the overall trend is positive, but the MCX gold rate today is facing resistance at the ₹78,800 mark. On breaching above this hurdle, the precious yellow metal may test a new peak.

Russia-Ukraine war in focus

Asked about the reason for today’s skyrocketing gold price, Sugandha Sachdeva, Founder of SS WealthStreet, said, “Gold prices advanced by around 5 per cent during the week, marking their best weekly performance since March 2023 and snapping a three-week decline. The rally was fueled by escalating geopolitical tensions between Russia and Ukraine, which have intensified missile attacks, driving safe-haven flows into gold.”

Echoing Sugandha Sachdeva’s views, Praveen Singh, Associate VP—Fundamental Currencies and Commodities at Sharekhan by BNP Paribas, said, “The Gold price rally is sparked by safe-haven demand on disturbing developments in the ongoing Russia—Ukraine war. On Thursday, Ukraine reported that Russia fired an ICBM on Ukraine, the first time in this war.”

Volatile stock market

Brandon Thor, Gold Expert and CEO of Thor Metals Group, said, “Gold is a simple yet powerful investment driven by three key factors: currency strength, geopolitical Uncertainty, and market volatility. The stock market’s unprecedented decade-long bull run, driven by financial engineering like buybacks of shares and quantitative easing, has created a fragile foundation. Rising interest rates and inflation threaten corporate profitability, while overvaluation heightens correction risks. Geopolitical tensions, domestic divisions, and global uncertainties further amplify the gold case.”

Donald Trump factor

Pointing towards the economic Uncertainty, Sugandha Sachdeva of SS WealthStreet said, “Uncertainty stemming after Donald Trump’s victory in the US Presidential Elections and anticipated changes in US economic policies have propelled the US dollar index to a two-year high. Gold found strong support at the ₹73,500 per 10 gm level ($2,540 per ounce in international markets) before rebounding sharply.”

Gold price outlook

Speaking on the outlook for gold prices, Brandon Thor of Metals Group said, “With central banks tightening monetary policies, economic headwinds, and geopolitical risks on the rise, precious metals offer a secure store of value and opportunity for growth. Allocating a portion of your portfolio to gold and silver can help protect wealth while positioning for gains as these drivers intensify.”

“The macroeconomic backdrop for gold remains mixed. On the one hand, a stronger dollar and expectations of a shallower rate-cut cycle under a potential Trump presidency act as headwinds. On the other hand, intensifying geopolitical tensions and sustained inflows into global gold ETFs provide support,” said Sugandha Sachdeva.

The SS WealthStreet expert said the MCX gold rate today faces resistance at ₹78,800 per 10 gm and support at ₹73,500 per 10 gm. A decisive break above or below these levels will set the price trend.

On triggers that may dictate gold prices next week, Sugandha Sachdeva said, “Market participants will closely monitor the US Q3 GDP data (second estimate) and the US PCE price index, which are expected to provide further direction for the yellow metal.”

“Overall, the outlook for gold prices is looking positive until there is any ease in the Russia-Ukraine war. So, we can expect the gold prices to continue uptrend next week and break above the current hurdle. So, much depends on the developments in the Russia-Ukraine war. Hence, gold investors are advised to remain vigilant about the latest Russia-Ukraine news,” said Anuj Gupta, Head of Currency and Commodity at HDFC Securities.

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 taking any investment decisions.