The Rising Gold Prices
Mumbai, May 21 (SocialNews.XYZ) Gold prices have been booming for the last few months. According to the Indian Bullion Jewelers Association (IBJA), the price of 10 grams of 24-carat gold increased to Rs 74,220 per 10 grams on Tuesday, which was Rs 73,383 in the previous trading session on May 17. This surge in gold prices indicates a strong demand for the precious metal in the market.
Insight:
The global economic uncertainties and geopolitical tensions have been major factors driving the rise in gold prices. Investors tend to flock to gold as a safe-haven asset during times of volatility, which has contributed to the bullish trend in gold markets.
Factors Contributing to Gold Price Surge
As of April 30, 2024, physical gold has delivered a CAGR of 19.42 per cent in the 12-month period and absolute returns of 6.78 per cent (1-month period) during April. This indicates the strong performance of gold as an investment option in recent times.
Gold prices have seen a significant upward trajectory from the US$ 2050 base, primarily due to tensions in the Middle East and the Federal Reserve’s stance on policy rates. These external factors have influenced the movement of gold prices in the global market.
Insight:
Central bank demand and retail demand are likely to support gold prices, mitigating the potential for significant corrections in the near term. The balance between supply and demand dynamics will play a crucial role in determining the future trajectory of gold prices.
The markets have reacted to the de-escalation of geopolitical tensions, but the underlying factors driving the gold prices remain intact, hinting at a sustained bullish trend in the coming days.
While gold may encounter resistance levels in the range of US$2370 – US$2390, the overall sentiment towards gold remains positive, supported by diverse demand drivers.
Source: IANS
