Gold and silver prices are trending upward due to strong demand, and experts predict this momentum will continue through the festive season. So far this financial year, gold and silver have seen price increases of nearly 10% and 24%, respectively.
Sachin Jain, Regional CEO of the World Gold Council in India, said, “From the Indian perspective, with the customs duty cut in July, that has and will give a big boost to consumption of gold. We broadly foresee that the October-December quarter would be pretty strong. It’s a good time for gold.”
Ajay Kedia, head of Kedia Advisory in Mumbai, anticipates that gold futures could rally towards Rs 77,000 in the near term. Currently, gold prices hover around Rs 75,000 per 10 grams, slightly below the all-time high of about Rs 75,400. At the beginning of the financial year, prices were around Rs 68,700. Kedia said, “For a rally, a correction in prices is also needed, which we are seeing now. ETF buying, central banks’ buying, and geopolitical tensions all are bull factors for gold.”
For silver, Kedia predicts prices may rise to Rs 100,000 per kg in the near-to-mid term. He said, “The industrial use of silver is increasing, such as for EVs and solar panels. Silver prices were unable to pick up because of recession fears in certain countries. But in the past months, we have been seeing outperformance in silver.” Currently, silver prices are around Rs 93,000 per kg, compared to Rs 75,000 at the start of the current financial year.
Manoj Kumar Jain, Director and Head of Commodity and Currency Research at Prithvi Finmart, supports the outlook for gold, projecting futures could touch Rs 77,000 and silver at Rs 96,000 soon. “Usual market fundamentals are not working, and the bull run in the market is driven by post-COVID gold buying by central banks as part of de-dollarisation, along with heightened geopolitical tensions and rate cuts by various central banks. A reduced interest rate is also a positive for gold and other commodities,” Jain said.
International gold prices have surged this year by about 40%, compared to the usual average of about 10%, Jain added. Colin Shah, Managing Director of Kama Jewelry and former Vice Chairman of the Gem and Jewellery Export Promotion Council (GJEPC), said that robust demand for gold is expected with the festive season approaching. “The key drivers behind the stellar performance of gold include the beginning of a rate cut cycle in the US and strong anticipation for further rate cuts in upcoming meetings. Geopolitical tensions between Israel and Lebanon are also pushing gold prices up,” Shah added.
Currently, international gold prices are testing the USD 2,700 levels per ounce, with Shah expecting it may touch USD 3,000. He also believes domestic prices could cross Rs 78,000 in the medium to long term.
Pranav Mer, Vice President of Commodity and Currency Research at JM Financial Services Ltd, echoed similar sentiments, saying that bullion will likely remain supported by safe-haven demand and buying among ETF investors. “On chart… the trend remains positive until support at Rs 75,850/Rs 75,500 holds, while resistance is seen at Rs 76,550 for December futures,” Mer added.
