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What is the story about?
Gold prices were steady on Friday (October 3) and remain on track for their seventh consecutive weekly rise, supported by expectations of further US interest rate cuts and investor caution over a prolonged US government shutdown.
Spot gold traded at $3,851.99 per ounce as of 02:47 GMT, holding near Thursday’s (October 2's) all-time high of $3,896.49 an ounce. Bullion has risen 2.4% an ounce so far this week, while US gold futures for December delivery were up 0.2% at $3,874.40 an ounce.
Global drivers and market sentiment
Despite a brief slowdown in momentum due to strength in the US dollar, analysts say the broader trend for gold remains positive.
Tim Waterer, Chief Market Analyst at KCM Trade, said the dollar’s climb created “a minor speed bump” but added that uncertainty over the US government shutdown and expectations of lower interest rates are keeping gold well supported.
The shutdown, now in its second day, has already delayed key economic data releases, including the US non-farm payrolls report due on Friday (October 3).
US rate expectations continue to bolster sentiment. Traders are pricing in a near-certain 25 basis-point rate cut this month, according to the CME FedWatch tool.
Dallas Federal Reserve President Lorie Logan said the central bank was cautious about further easing but acknowledged that last month’s cut helped insure against labour market risks.
With rates expected to remain low, gold continues to benefit as a safe-haven asset and non-yielding store of value. Prices have gained 47% so far this year.
Domestic gold prices
In India, gold rates were mostly steady, tracking global trends and supported by currency movement. The price of 24 karat gold stood at ₹11,804 per gram, while 22 karat gold was priced at ₹10,820 per gram. For 18 karat gold, also known as 999 gold, prices were at ₹8,853 per gram, as per Goodreturns.
A weaker rupee continues to lend support to domestic bullion prices.
Analyst commentary
Rahul Kalantri, VP Commodities at Mehta Equities, said gold witnessed sharp volatility internationally due to profit booking from all-time highs ahead of US jobs data. A decline in crude oil prices also weighed on sentiment. He noted that market expectations of an increase in non-farm payrolls triggered profit-taking in both metals.
However, Kalantri maintained that the long-term outlook for gold remains positive as broader fundamentals are intact.
He added that rupee weakness is supporting Indian prices.
Darshan Desai, CEO of Aspect Bullion & Refinery, said gold saw mild profit-taking on Thursday (October 2) after a sharp rally of nearly 50% this year. He pointed out that the metal remains on track for its seventh straight weekly gain, even as technical indicators suggest short-term overbought conditions.
According to Desai, uncertainty around the US shutdown and its impact on Federal Reserve policy could limit downside pressure from a stronger dollar. He suggested that investors may consider booking partial profits but look to re-enter the market on any correction, as lower price levels are likely to draw buying interest from central banks and ETF investors.
-With Reuters inputs
Spot gold traded at $3,851.99 per ounce as of 02:47 GMT, holding near Thursday’s (October 2's) all-time high of $3,896.49 an ounce. Bullion has risen 2.4% an ounce so far this week, while US gold futures for December delivery were up 0.2% at $3,874.40 an ounce.
Global drivers and market sentiment
Despite a brief slowdown in momentum due to strength in the US dollar, analysts say the broader trend for gold remains positive.
Tim Waterer, Chief Market Analyst at KCM Trade, said the dollar’s climb created “a minor speed bump” but added that uncertainty over the US government shutdown and expectations of lower interest rates are keeping gold well supported.
The shutdown, now in its second day, has already delayed key economic data releases, including the US non-farm payrolls report due on Friday (October 3).
US rate expectations continue to bolster sentiment. Traders are pricing in a near-certain 25 basis-point rate cut this month, according to the CME FedWatch tool.
Dallas Federal Reserve President Lorie Logan said the central bank was cautious about further easing but acknowledged that last month’s cut helped insure against labour market risks.
With rates expected to remain low, gold continues to benefit as a safe-haven asset and non-yielding store of value. Prices have gained 47% so far this year.
Domestic gold prices
In India, gold rates were mostly steady, tracking global trends and supported by currency movement. The price of 24 karat gold stood at ₹11,804 per gram, while 22 karat gold was priced at ₹10,820 per gram. For 18 karat gold, also known as 999 gold, prices were at ₹8,853 per gram, as per Goodreturns.
A weaker rupee continues to lend support to domestic bullion prices.
Analyst commentary
Rahul Kalantri, VP Commodities at Mehta Equities, said gold witnessed sharp volatility internationally due to profit booking from all-time highs ahead of US jobs data. A decline in crude oil prices also weighed on sentiment. He noted that market expectations of an increase in non-farm payrolls triggered profit-taking in both metals.
However, Kalantri maintained that the long-term outlook for gold remains positive as broader fundamentals are intact.
He added that rupee weakness is supporting Indian prices.
Darshan Desai, CEO of Aspect Bullion & Refinery, said gold saw mild profit-taking on Thursday (October 2) after a sharp rally of nearly 50% this year. He pointed out that the metal remains on track for its seventh straight weekly gain, even as technical indicators suggest short-term overbought conditions.
According to Desai, uncertainty around the US shutdown and its impact on Federal Reserve policy could limit downside pressure from a stronger dollar. He suggested that investors may consider booking partial profits but look to re-enter the market on any correction, as lower price levels are likely to draw buying interest from central banks and ETF investors.
-With Reuters inputs
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