Gold Prices Dip Ahead of Dhanteras
Spot gold prices declined by 0.48% to ₹77,622.00 per 10 grams around 10 am IST on Monday, October 28, 2024, according to MCX data. This comes after prices having consistently rallied for most parts of the year.
Market Factors Impacting Gold Prices
Meanwhile, Gold futures prices on the MCX for December 05, 2024, dropped by 0.42% or by ₹332 to 78,200.
The short-term decline in gold prices has been attributed to a rise in the US dollar (Currently at ₹84.0725 per dollar) as investors eyed US macro data which includes inflation data and GDP prints to anticipate potential rate cuts by the US Federal Reserve.
Seasonal Trends and Global Events
This drop in gold prices comes a day before Dhanteras, a festival where buying gold is considered auspicious. Gold prices on the occasions of Dhanteras and Diwali have gone up nearly 30% over the last year. Additionally, gold has outperformed domestic equities this year with the benchmark BSE Sensex rising only 10.79%.
Gold prices have been on the rise due to multiple factors including geopolitical tensions like the Russia-Ukraine war and the Israel-Gaza conflict. Another contributing factor was the decision of China’s central bank to reduce its 1-year and 5-year prime loan rates by 25 basis points.
Looking Ahead
While short-term fluctuations in gold prices are influenced by various factors, long-term trends are often shaped by global events, investor sentiment, and economic indicators. Keeping an eye on these influences can help investors make informed decisions when it comes to investing in gold.
