Gold price update
Gold reached a new record high of Rs 70,275 per 10 grams in the domestic market, as reported by MCX. On April 5th, it began trading at Rs 69,868 per 10 grams. However, it later declined to Rs 69,801 per gram. At its lowest point during the day, it touched Rs 69,800. The futures contract for June expiry of gold surged to an unprecedented Rs 69,908. Market analysts attributed this rally to comments made by US Fed chair Jerome Powell regarding potential rate cuts.
On April 4th, US Fed Chair Powell hinted at the possibility of rate cuts, which bolstered the gold rally, according to Bhavik Patel, a commodity and currency analyst at Tradebull Securities. Over the past six trading sessions, gold price has overcome various obstacles and consistently reached new all-time highs in both MCX and COMEX. On April 4th, gold closed above $2300 in COMEX for the first time.
Despite yesterday’s higher-than-expected US ADP Non-farm payroll data and weak ISM service PMI, gold’s price upward momentum remained unaffected, Patel noted. Furthermore, gold’s gains persisted even as CME’s FedWatch tool slightly reduced the probability of a rate cut in June from 60% to 58% earlier in the week, attributing it to stronger US manufacturing data.
Foreign exchange strategists surveyed by Reuters anticipate that the U.S. dollar will maintain its strength in the forthcoming months as markets resist expectations regarding the timing and scale of Federal Reserve interest rate reductions. Additionally, Russia’s finance ministry announced plans to increase its acquisitions of foreign currency and gold by more than twofold in the upcoming month.
