Gold Prices Dip Weekly Amid Fading Fed Rate Cut Hopes and Trade Deal Uncertainty

The price of 24-carat gold experienced a notable dip this past week, with a Rs 1,649 reduction per 10 grams, and a further Rs 4 drop on Saturday, bringing the price to Rs 1,20,770. This decline, as reported by the India Bullion and Jewellers Association (IBJA), was influenced by several key global factors. Fading expectations for immediate US Federal Reserve rate cuts played a significant role, especially after the Fed's recent 25 basis points cut to the 3.75 per cent–4 per cent range, with hints that further easing might be postponed until 2025. Market probabilities for a December rate cut have decreased substantially. Concurrently, progress on US trade deals, particularly with China and India, introduced uncertainty, despite announcements regarding tariff adjustments and trade in specific goods. A strengthening US dollar and weaker international bullion prices also contributed to the downward pressure on gold. Analysts suggest key support levels around Rs 1,18,000 and resistance near Rs 1,24,000, with gold expected to remain volatile until clarity emerges on trade discussions.

Impact This news directly impacts investors holding gold as an asset, commodity traders, and the jewelry industry in India. The volatility affects purchasing decisions and investment strategies. Rating: 7/10

Definitions: Federal Reserve: The central banking system of the United States, responsible for monetary policy. Basis Points: A unit of measure used in finance to denote the percentage of a basis point is 1/100th of 1%, or 0.01%. Bullion: Gold or silver in the form of bars or ingots, considered a form of investment. Dollar: Refers to the United States Dollar, the official currency of the USA. Tariffs: Taxes imposed by a government on imported goods or services. Rare earths: A group of 17 chemical elements with unique properties crucial for modern technologies, including electronics and defense systems.