CHENNAI: Gold prices continued their rally on Friday, with both global and Indian markets showing firm gains as investors and consumers sought safety amid global uncertainties and strong festive demand in India. The precious metal touched new records, supported by expectations of US rate cuts, central bank buying, and a weaker dollar.
In global markets, spot gold climbed to around $4,362 per ounce, extending its nearly 20 percent monthly gain. Year-to-date, gold is up over 60 percent, marking one of its strongest performances in recent years. Analysts attribute the rally to expectations that the US Federal Reserve will begin cutting interest rates soon, which typically boosts non-yielding assets like gold. Geopolitical tensions and the ongoing US-China trade friction have further strengthened the metal’s safe-haven appeal.
Several global institutions have revised their outlooks upward. HSBC raised its gold price forecasts for 2025 and 2026, citing stronger-than-expected central bank demand, while Goldman Sachs noted that the current rally is built on real buying rather than speculation. The dollar’s recent weakness has also made gold cheaper for non-US buyers, helping sustain global demand.
In India, the world’s second-largest gold consumer, domestic prices reached new highs as the festival season gathered pace. On Friday, 24-carat gold traded at around Rs 12,944 per gram, while 22-carat gold hovered near Rs 11,865 per gram. On the Multi Commodity Exchange (MCX), December futures surged to nearly Rs 1,28,400 per 10 grams, with traders expecting the Rs 1,30,000 mark to be crossed soon if the global uptrend continues.
Dealers reported that premiums in India jumped to about $25 per ounce over international prices — the highest in more than a decade — as jewelers and investors rushed to stock up ahead of Dhanteras and Diwali. However, high prices have also shifted consumer behavior, with many preferring coins and bars over jewelry purchases this year. Reuters reported that smuggling activity has also increased, driven by strong domestic prices and supply constraints.
Despite record levels, analysts warn of potential short-term corrections. With valuations running high, some investors may look to book profits once festival demand peaks. Any delay in US rate cuts or easing of global tensions could also limit further upside. Still, most analysts expect gold to stay strong through the rest of October, supported by steady retail demand and sustained interest from central banks and institutional investors.
In the near term, gold may test $4,400 per ounce globally and Rs 1.3 lakh per 10 grams in India, provided macroeconomic conditions and risk sentiment remain supportive. For now, the yellow metal continues to glitter — both as a cultural symbol and a global hedge against uncertainty.
