Mar 10, 2024 05:01 PM IST
Gold prices recently surged to a new peak, indicating a major spike in the rates in the global markets.
Gold prices are on the rise across the globe, with the yellow metal recently hitting its peak in India at ₹65,298 per 10 grams on the MCX. This indicated a significant spike of over ₹2,700 in just the first week of March 2024. Gold hits its peak in Delhi on Thursday, but the reason of this uptrend has been attributed to the speculations of an interest rate cut by the US Federal Reserve in June.
The anticipation linked to the US Federal Reserve rate cut has made a significant impact on both domestic and international markets, adding to the gold prices in the country.
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However, international gold prices sunk 0.25 percent in February, ending the month at $2032.8 per ounce. Meanwhile, domestic prices closed at 0.67% lower in February, before witnessing a significant spike in the first week of March.
While gold prices have been on the rise, MCX Silver rates saw a drop last week. Slipping significantly on Wednesday, silver was trading at ₹74,015 per kg, showing a decrease of ₹123 or 0.17 percent.
This was just a short-term setback for silver, as experts have predicted a significant rise of almost ₹2,859 or 4.01% in March this year, reported Mint.
Reason behind surge in gold prices
The primary reason behind the surge in gold prices over the last month was the decline in the dollar index (DXY). This month, the index dipped below the 104 mark, standing at 103.80 against a basket of six major currencies.
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Another major factor is the interest rate cut expected by the US Federal Reserve, heavily influencing the markets across the globe. It is expected that the interest cuts will be announced by June this year.
According to data by the World Gold Council, central banks’ acquisitions of gold in 2023 amounted to 1,037 tonnes, falling slightly short of the record established in 2022, reported Mint.
Mint further quoted the experts as saying that the upward trend for the gold prices is set to continue throughout the month, factoring the geopolitical tensions and the uncertainty on the macroeconomic front. The US monetary policy is also expected to influence the gold prices in the coming weeks.
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