Gold prices in India fell 2.6 percent in November 2024 to pause for the first three months straight. Analysts said a strong US dollar and decreased geopolitical tensions led to this fall; however, renewed global uncertainties combined with strong domestic demand will mean a rebound in the next few weeks.
As India saw a dip in its gold prices, geopolitical risks went down with the Israeli and Hezbollah ceasefire announcement and due to Donald Trump’s victory appreciated the value of the dollar to increase the value of yellow metal in America.
Sugandha Sachdeva, founder of SS WealthStreet, stated that the price of gold on the Multi Commodity Exchange fell by ₹2,069 per 10 grams for the December 2024 contract and ₹1,851 per 10 grams for February 2024 futures.
Escalation of Russia-Ukraine Conflict
Renewed tensions in the Russia-Ukraine war have reignited safe-haven demand for gold globally. Russia’s warning of broader escalation in response to Ukraine’s use of Western-made long-range missiles added to the geopolitical uncertainty, supporting gold prices in India toward the end of November.
The US dollar index also declined to a two-week low, further relieving the domestic gold market.
Domestic Demand to Drive Gold Prices in India
The ongoing wedding season in India is likely to boost physical gold demand. According to Anuj Gupta, Head of Commodity & Currency at HDFC Securities, domestic demand and geopolitical factors may push gold prices upward in the short term.
According to experts, gold prices in India are expected to resist ₹78,800 per 10 grams, with support at ₹73,500 and ₹71,700. The key drivers now are the US Federal Reserve meeting and economic data coming in, which will likely affect the direction of gold going forward next month.
The immediate outlook for gold prices in the country remains positive, even considering the correction seen recently as the global and domestic landscape changes.