Following a three-month upward trend, gold price in India dropped by approximately 2.60% in November 2024. The decline in gold rates was primarily triggered by the announcement of a ceasefire between Israel and Hezbollah, coupled with the strengthening of the US dollar. However, market experts predict that gold rates will rebound due to escalating tensions in the Russia-Ukraine conflict, accusations of ceasefire violations between Israel and Hezbollah, and the upcoming wedding season in India.
Experts forecast that MCX gold prices may surge to Rs 78,800 per 10 grams, driven by a positive near-term outlook for the precious metal.
Gold Price – What’s Behind The Decline?
Experts attribute the recent decline in gold prices to two primary factors: the ceasefire agreement between Israel and Hezbollah, and the surge in the US Dollar Index following Donald Trump’s victory in the US Presidential elections. On the other hand, the robustness of the US economy has raised uncertainty about additional interest rate cuts in 2025 by the US Federal Reserve, putting downward pressure on gold prices.
What Next?
Market experts anticipate a rebound in gold price. They believe that the rising tensions between Russia and Ukraine sparked safe-haven demand for gold later in the week, which helped reduce losses for the week. Analysts say that Russia’s threat of a wider escalation in response to Ukraine’s deployment of Western-made long-range missiles injected additional geopolitical uncertainty. Meanwhile, the dollar index slipping to a two-week low provided further upward momentum for gold prices. They believe that gold rates may see a surge due to the support from physical demand in the domestic market.
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