Gold Gains Rs 550 Amid Market Uncertainty

SRINAGAR: Gold prices bounced back on Monday, ending the first quarter on a strong note with a gain of Rs 550 per 10 grams to Rs 96,014 on the Multi Commodity Exchange (MCX), following a steep intraday fall of nearly Rs 1,500 on Friday.

According to Business Today, the rally was driven by a combination of weakening equity markets globally—excluding the US—and a drop in the US dollar index, which fell by 0.17 per cent to 97.24. India’s benchmark indices mirrored the global sentiment, with the Sensex slipping 452 points to 83,606 and Nifty falling by 121 points to 25,517. Asian markets also closed lower, with the Hang Seng down 212 points and the Taiwan Weighted Index dropping 324 points.

Analysts attribute the upswing in gold to its traditional role as a safe-haven asset, which becomes attractive when equity markets are volatile. “The rebound comes after a sharp bout of profit booking last week. With a weak dollar and rising market uncertainty, investors are returning to gold,” said Jateen Trivedi, VP, Research Analyst at LKP Securities. He added that gold is expected to trade in a tight range of Rs 94,000–Rs 97,500 in the near term, influenced by upcoming US macroeconomic data.

Aksha Kamboj, Vice President of the India Bullion and Jewellers Association, noted that while short-term price action might see a dip to Rs 96,200–Rs 96,700, the long-term outlook remains bullish. “Global forecasts suggest gold could rise by 10-12 per cent over the next year, especially if geopolitical tensions persist and central banks continue their buying spree,” Kamboj told Business Today.

Rahul Kalantri, VP Commodities at Mehta Equities, said gold prices had recently slipped due to the ceasefire between Israel and Iran, which deflated the war-risk premium. However, he added that dollar weakness and renewed geopolitical tensions, particularly in the Russia-Ukraine region, are now cushioning the downside.

Technically, gold has support at Rs 95,100–Rs 94,780 and resistance at Rs 95,940–Rs 96,450 in the domestic market, while international spot gold is expected to find support at $3,264 and face resistance near $3,335.

Earlier on June 16, MCX gold prices had touched an all-time high of Rs 1,01,078 per 10 grams. Despite a 5 per cent decline since then, analysts believe the yellow metal’s resilience highlights its critical role during periods of global economic and political instability.