Gold prices heading toward record highs soon: What's the reason?
What's the story
Gold prices are expected to remain strong and could approach record highs in the coming week, as investors await key US data, Federal Reserve Chair Jerome Powell's speech, and the Reserve Bank of India's policy decision. Pranav Mer, VP at JM Financial Services Ltd's EBG-Commodity & Currency Research division, said gold is moving out of its consolidation range with traders focusing on PMI data from different regions.
Market dynamics
Factors influencing gold prices
Mer also noted that Powell's speech tomorrow, developments in Russia-Ukraine peace talks, and RBI policy meeting on Friday will be closely watched by traders. On the Multi Commodity Exchange (MCX), gold futures for February 2026 contract rose by ₹3,654 or 2.9% over the last week to settle at ₹1,29,504 per 10g on Friday.
Local influence
Domestic factors impacting gold prices
Prathamesh Mallya, DVP at Angel One's Non-Agri Commodities and Currencies division, said rupee's weakness and local demand have significantly contributed to gold price volatility in India. He added that the demand from festivals, weddings, and continued jewelry purchases continue to support precious metal prices. Mallya also said global central banks' sustained gold accumulation would keep the long-term outlook constructive for gold prices.
Global trends
International gold prices also see significant rise
In international markets, Comex gold futures for December delivery rose by $138.8 or 3.4% during the week to settle at $2,218.3 per ounce on Friday. JM Financial Services said gold prices rallied over 1% after trading resumed on CME post an 11-hour outage. The rally was supported by a weaker US dollar, dovish commentary from the Fed officials, and rising bets for an imminent rate cut by the US Federal Reserve.