Gold Prices Reach Record Highs on Diwali; Set for Best Month in Seven Years - Read Now
Today, India celebrates Diwali, but gold prices have hit a record in both domestic and international markets. The precious metal has gained much attraction from investors due to safe-haven demand caused by economic uncertainties and expectations of the U.S. elections scheduled on November 5.
Gold Prices on the Rise
October 31, 2024: Gold set a fresh record of $2,790.15 per ounce. It has surged by a whopping 6% for the month. At 0254 GMT, on the other hand, the spot gold is unchanged to $2,786.89 an ounce. Conversely, the U.S. gold futures slipped 0.1% to $2,797.80 per ounce.
Investors are eyeing the upcoming U.S. core PCE data on the 29th, which recorded a 0.3% rise for the month of September, as something that may push gold prices up further. "The boost in gold can be fully attributed to safe haven trades as people try to hedge against any deficit spending in the United States," said Kyle Rodda of Capital.com who tracks the financial markets, "Especially if one believes Donald Trump is more likely than not to come out the winner."
Festive Demand Impact in India
The prices have mainly been increased by the festive demand in India. Now, 24-carat gold is selling at ₹81,160 for 10 grams and 22-carat gold is being sold at ₹74,400. The rise in the price of gold over the last week is approximately 1.83%. It has been an upward trend since the demand is high during Diwali.
LKP Securities' VP Research Analyst, Jateen Trivedi: "Gold stays optimistic due to festive demand in India. Market rumors over a possible Trump win is further driving the prices high."
Breakout level is ₹78,200/10 grams for trades. Diwali target stands at ₹80,000/10 grams.
Market and Sectoral Factors
As U.S. voters prepare for the presidential election, gold prices continue responding to expectations of increased fiscal spending, further reinforcing its appeal as a safe-haven asset. Analysts also suggest that the Federal Reserve may soon reduce borrowing costs, which will help set a favorable environment for the rise of gold prices.
According to Matt Simpson, senior analyst at City Index: "Gold's trend appears to be ready to keep going higher at least if inflation data is not worse than expected."
Silver and Other Precious Metals
Although silver has not received much focus from the limelight of gold, it too has experienced some pretty strong demand. Silver has now reached a price of ₹97,850 per kilogram in India as of today and is witnessing very strong performance during the rally of metals. Silver has decreased 0.3% at $33.68 an ounce in the international markets but is witnessing great performance in the month of October.
The platinum and palladium also have remained steady with tremendous resilience against the global demand for precious metals.
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