Following uncertainty in the global economy caused by Donald Trump’s tariff policy, gold price today witnessed strong buying in early morning deals. MCX gold rate opened upside at ₹84,946 and touched an intraday high of ₹ ₹85,162 per 10 gm within a few minutes of the Opening Bell on Monday. In the international market, the COMEX gold price oscillates around $2,915 per troy ounce, while the spot gold price hovers around the $2,904 per ounce mark (at 9:50 AM).
According to market experts, the gold rate today is on an uptrend because of two factors: the US dollar rate hitting a two-month low and uncertainty surrounding US trade policy. They said that gold prices are expected to remain in a bull trend and predicted $3,000 and $3,080 per ounce if the economic uncertainty caused by Donald Trump’s tariff policy doesn’t end soon.
Weakness in the US dollar rates
On the immediate reason fueling the gold price today, Anuj Gupta, Head—Commodity & Currency at HDFC Securities, said, “The Gold rate today is in a bull trend due to two factors: the US dollar rate hitting a two-month low and uncertainty surrounding US trade policy. ”
Why is the gold price skyrocketing?
Ventura Securities says, “With the increased US trade tariffs, there’s a lot of uncertainty surrounding the U.S. trade policy. These have increased the demand for safe-haven assets like Gold. Spot gold hit a record high of $2,943, and Comex gold $2968 an ounce. There are talks around about tariffs on gold, which also has sparked a rush for the physical metal in London, Switzerland and Asia to ship to the US ahead of any new levy.”
Rising demand by central banks
Pointing towards the rising demand by central banks for the precious yellow metal, Ventura Securities said, “Gold price keeps trading at record highs on the back of increasing demand by central banks for their reserves to maintain an expected surge in fiscal deficits which could raise inflation manifold and probably a recessionary fear across the globe. Central banks acquired 1,045 tons of gold in 2024, marking the 3rd consecutive year of purchases surpassing 1,000 tons. Central banks bought more gold over the last 3 years than in 6 years before 2022.”
Gold price outlook
Ventura Securities said on the outlook for gold prices, “Gold price today seems to head $3,000 per ounce and likely to well cross $3,080. The recent strength stems from a mix of higher tariff safe haven demand, geopolitical uncertainties, inflation concerns, central bank policies, and continued strong demand from both central banks and retail investors.”
Gold price today: Other triggers to look at
Gold price is pressured due to the strength of Treasury yields and dollar bias after Federal Reserve Chair Jerome Powell has been cautious and flagged as not hurrying to cut interest rates.
Powell also noted that US monetary policy had been sufficiently loosened after 100 basis points of rate cuts through 2024 (From 5.50% to 4.50%).
Due to the strength of the USD, bigger gains in gold are restricted, and interest rates are still elevated. Since US importers face inflation due to tariffs, the FED has less impetus to cut interest rates. High interest rates present more pressure on non-yielding assets like gold.
CPI inflation data for January was 3.0% YOY as expected from December (Rose 2.9% YOY). A stronger CPI report could prove more damaging for riskier assets but may boost the US dollar.
Powell says, “If the economy remains strong and inflation does not continue to move sustainably toward 2 per cent, we can maintain policy restraint for longer. If the labour market were to weaken unexpectedly or inflation was to fall more quickly than anticipated, we can ease policy accordingly.”
“Gold will continue to be volatile, but as long as “uncertainty” prevails, it is likely to remain bullish,” Ventura Securities report said.
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