Gold buying in India is considered auspicious during the festive season. The demand for physical gold rises during the Dussehra and Diwali festivals in the country.
Along with its sentimental value, people buy gold for investment purposes as it is also considered a safe-haven asset in times of uncertainty in the global markets.
Since Diwali last year, gold prices have given over 20% returns so far as the rates have surged by around ₹10,000 per 10 grams in the domestic market to ₹60,700.
Analysts expect gold prices to remain elevated and continue giving decent returns going ahead in light of the upcoming festive season.
Also Read: Why the Gold Price is Rising? Should You Buy Gold Now?
On Tuesday, gold prices traded higher. The yellow metal hit a five-month peak on October 20, while it has surged about 9% in the past two weeks on safe-haven demand amid worries that the Israel-Hamas war could escalate into a wider Middle East conflict. In the international markets, spot gold was up 0.2% at $1,976.99 per ounce, while US gold futures was steady at $1,988.10.
On the domestic side, gold prices ended 0.23% lower at ₹60,598 per 10 grams on the Multi Commodity Exchange of India (MCX) Monday. Silver prices also fell 1.18% to ₹72,052 per kg. Indian markets are shut on Tuesday for Dusshera holiday.
(Exciting news! Mint is now on WhatsApp Channels Subscribe today by clicking the link and stay updated with the latest financial insights! Click here!)
Analysts believe the bullish fundamentals for gold and silver remain intact amid the ongoing broader global concerns.
“The current environment for bullion remains good. While geopolitical concerns continue to support gold prices, physical buying during the festive season will also lift prices. Silver prices may outperform given its rising industrial demand,” said Ajay Kedia, Director, Kedia Advisory as he believes the fundamentals for gold and silver continue to remain bullish.
Moreover, Kedia expects the rupee to weaken further, which will be supportive of gold prices going forward.
Also Read: Physical gold or digital gold? This is the best way to buy the yellow metal this Dussehra
“We expect gold prices to hit ₹62,000 – ₹62,500 per 10 grams level, while silver price may test ₹75,000 level this Diwali,” Kedia said.
By December 2023, he expects gold prices may test ₹64,000 per 10 grams level on MCX and silver rate may scale ₹85,000 per kg level.
Overall, buying gold during the festive season in India is a long-standing tradition due to its auspicious and investment value. Gold prices have shown significant gains in the past year, and analysts anticipate further increases. However, it is essential to consider your investment goals before making any investment decisions.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.
“Exciting news! Mint is now on WhatsApp Channels 🚀 Subscribe today by clicking the link and stay updated with the latest financial insights!” Click here!
Download The Mint News App to get Daily Market Updates & Live Business News.
Updated: 24 Oct 2023, 12:44 PM IST