Gold prices rise amid global tailwinds, investors eye festive season buying

Gold prices in India edged higher on Monday (October 20), supported by expectations of further US interest rate cuts and global economic uncertainties. As of today, 24-karat gold is trading at ₹13,069 per gram, 22-karat at ₹11,980, and 18-karat (999 gold) at ₹9,802 per gram.

Globally, spot gold was up 0.1% at $4,253.33 per ounce, while US gold futures for December delivery climbed 1.3% to $4,266.30 per ounce.

Analysts attribute the recent volatility to mixed global signals.

“The gold market is trying to find its footing after Friday's (October 17's) selloff. Sentiment is normalising after a few weeks of mania,” said Kyle Rodda, analyst at Capital.com.

Friday’s drop followed US President Donald Trump’s comments on China tariffs, which initially fueled a spike in gold prices. Investors are now focusing on upcoming US-China trade talks and the release of US inflation data, with core CPI expected to hold at 3.1% for September.

Expectations of US rate cuts are driving the rally. Markets are pricing in a quarter-point Federal Reserve rate cut this month, with another likely in December, according to the CME FedWatch Tool.

These moves, coupled with geopolitical tensions and steady central bank purchases, have lifted gold by over 60% year-to-date, pushing it to an all-time high of $4,378.69 per ounce last week.

Globally, central banks have been steadily increasing their gold reserves, a trend reflecting heightened demand for safe-haven assets amid geopolitical and economic uncertainty.

“Investments in gold and silver passive funds, mainly through ETFs, have picked up sharply in recent years,” said Mayank Bhatnagar, co-founder and COO of FinEdge. “They offer ease of investing without the hassle of physical storage, which makes them attractive. However, strong global demand and constrained supply have pushed ETFs to trade at a high premium over spot prices, creating the risk of a bubble. Any exposure should be part of a well-thought-out financial plan rather than a reaction to seasonal hype.”

In India, the festive season continues to influence buying patterns. While traditionally linked torituals and celebrations like Dhanteras,

the current market is seeing a shift toward investment-oriented purchases.

“India’s investment share of gold demand is rising; buyers are gravitating toward coins and bars over expensive jewellery,” said Inderbir Singh Jolly, CEO of PL Wealth Management.

-With Reuters inputs