Gold prices are poised to extend gains in the coming week as macroeconomic uncertainty, trade tensions and central bank buying continue to fuel investor demand, analysts said.Traders will track a string of key economic data releases, including GDP figures from the UK and EU, and US Core PPI and Core CPI data. Speeches from US Federal Reserve officials will also be closely watched for clues on the near-term trajectory of gold prices, PTI reported.Prathamesh Mallya, DVP – Research, Non-Agri Commodities and Currencies at Angel One, said gold is making fresh highs in both domestic and international futures markets. “From the lows of Rs 98,079 per 10 grams on July 28, to the highs of Rs 1,02,250 per 10 grams, the shine in gold prices continues to increase the wealth of gold investors. In the international markets, prices have surged from $3,268 per ounce on July 30 to $3,534.10 per ounce as of August 8. The rally seems unstoppable,” he said.Last week, the most traded October gold futures climbed Rs 1,763, or 1.77 per cent, on the Multi Commodity Exchange (MCX). Mallya attributed part of the surge to heightened tariff tensions. “If it escalates further, gold might rally towards the $3,800 per ounce mark internationally, while MCX futures could head to Rs 1,10,000 per 10 grams over the next three months,” he said.He added, “Tariffs, tariffs, tariffs — it goes round and unending. In order to reshape global trade in America’s favour, the US has started imposing higher tariffs on goods from dozens of trading partners, and India has found itself in the crosshairs of US President Donald Trump as he announced doubling tariffs on India to 50 per cent over its move to purchase oil from Russia. This macro uncertainty has led investors globally to realign their portfolios, increasing allocations to gold.”Jateen Trivedi, VP Research Analyst – Commodity and Currency at LKP Securities, said the near-term bias for gold remains positive as long as it holds above Rs 99,000 per 10 grams. “While the dollar’s strength last week capped upside in gold, domestic prices are cushioned by rupee weakness, which is likely to keep the downside limited. Volatility is expected to persist, with a broader trading range of $3,360–3,425 on Comex and Rs 98,500–1,03,000 per 10 grams on the MCX,” he noted, quoted PTI.NS Ramaswamy, Head of Commodity & CRM at Ventura Securities, said weaker-than-expected US economic data has intensified speculation about a Federal Reserve rate cut. On Friday, Comex gold futures for December delivery touched an all-time high of $3,534.10 per ounce before settling at $3,491.30.“With both US growth and inflation worsening after last week’s soft jobs report, gold remains at record levels. Central banks are buying, global trade wars are ongoing, geopolitical risks are elevated, and ETF holdings continue to expand. The Fed cutting interest rates could be the missing catalyst to reignite a record-breaking rally,” he said.Ramaswamy also pointed to fresh triggers, including the US imposing import tariffs on one-kilo and 100-ounce gold bars, raising supply concerns, and fears about the Federal Reserve’s independence, both of which are boosting investor demand.“Looking ahead, investors believe central banks will continue to add gold to their reserves given the still-uncertain economic environment and the drive to diversify away from the US Dollar,” he added.Analysts said unless macroeconomic conditions reverse sharply, the mix of geopolitical uncertainty, trade tensions, currency fluctuations and central bank demand is likely to keep gold on an upward trajectory in the medium term.
About the Author
