Gold prices rose in India on Thursday, according to data compiled by FXStreet.
The price for Gold stood at 9,187.63 Indian Rupees (INR) per gram, up compared with the INR 9,130.41 it cost on Wednesday.
The price for Gold increased to INR 107,165.40 per tola from INR 106,495.30 per tola a day earlier.
| Unit measure | Gold Price in INR |
|---|---|
| 1 Gram | 9,187.63 |
| 10 Grams | 91,874.77 |
| Tola | 107,165.40 |
| Troy Ounce | 285,766.50 |
Daily Digest Market Movers: Gold price buying remains unabated amid safe-haven demand, weaker USD
The Republican-controlled US House of Representatives Rules Committee voted to advance President Donald Trump’s sweeping tax-cut and spending bill, setting the stage for a vote on the House floor. The highly anticipated “One Big, Beautiful Bill” could add around $3 trillion to $5 trillion to the country’s already hefty debt pile.
Furthermore, a crucial auction of 20-year Treasury bonds on Wednesday saw soft demand, pointing to growing worries that the tax and spending bill will worsen the US budget deficit at a faster pace than previously expected. This comes after Moody’s downgraded the US sovereign credit rating from the top "Aaa" last Friday.
The US Dollar has been trending lower on the back of US fiscal concerns. Adding to this, bets that the Federal Reserve will lower interest rates further this year amid evidence of easing inflation and a dismal growth forecast continue to push the USD lower, lifting the non-yielding Gold price to a nearly two-week high on Thursday.
Meanwhile, China accused the US of abusing export control measures and violating Geneva trade agreements after the US issued guidance warning companies not to use Huawei's Ascend AI chips. China’s Commerce Ministry said on Wednesday that US measures on advanced chips are ‘typical of unilateral bullying and protectionism.’
On the geopolitical front, Israel’s military continued to pound the Gaza Strip and block desperately needed food aid. Adding to this, Trump reportedly told European leaders that Russian President Vladimir Putin isn’t ready to end the war with Ukraine as he thinks he is winning, which lends additional support to the safe-haven commodity.
Traders now look to the release of flash PMI prints for a fresh insight into the global economic health. The US economic docket also features the release of the usual Weekly Initial Jobless Claims and Existing Home Sales, which might influence the USD. This, along with the broader risk sentiment, could drive the precious metal.
FXStreet calculates Gold prices in India by adapting international prices (USD/INR) to the local currency and measurement units. Prices are updated daily based on the market rates taken at the time of publication. Prices are just for reference and local rates could diverge slightly.
Gold FAQs
Gold has played a key role in human’s history as it has been widely used as a store of value and medium of exchange. Currently, apart from its shine and usage for jewelry, the precious metal is widely seen as a safe-haven asset, meaning that it is considered a good investment during turbulent times. Gold is also widely seen as a hedge against inflation and against depreciating currencies as it doesn’t rely on any specific issuer or government.
Central banks are the biggest Gold holders. In their aim to support their currencies in turbulent times, central banks tend to diversify their reserves and buy Gold to improve the perceived strength of the economy and the currency. High Gold reserves can be a source of trust for a country’s solvency. Central banks added 1,136 tonnes of Gold worth around $70 billion to their reserves in 2022, according to data from the World Gold Council. This is the highest yearly purchase since records began. Central banks from emerging economies such as China, India and Turkey are quickly increasing their Gold reserves.
Gold has an inverse correlation with the US Dollar and US Treasuries, which are both major reserve and safe-haven assets. When the Dollar depreciates, Gold tends to rise, enabling investors and central banks to diversify their assets in turbulent times. Gold is also inversely correlated with risk assets. A rally in the stock market tends to weaken Gold price, while sell-offs in riskier markets tend to favor the precious metal.
The price can move due to a wide range of factors. Geopolitical instability or fears of a deep recession can quickly make Gold price escalate due to its safe-haven status. As a yield-less asset, Gold tends to rise with lower interest rates, while higher cost of money usually weighs down on the yellow metal. Still, most moves depend on how the US Dollar (USD) behaves as the asset is priced in dollars (XAU/USD). A strong Dollar tends to keep the price of Gold controlled, whereas a weaker Dollar is likely to push Gold prices up.
(An automation tool was used in creating this post.)
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