11 hours ago
Gold prices in India rose sharply on Wednesday (May 21), tracking global gains as investors flocked to the safe-haven metal amid US fiscal concerns and rising geopolitical tensions.
In the Indian market, 24-karat gold jumped to ₹97,420 per 10 grams.
The price of 22-karat gold stood at ₹89,300 per 10 grams, while 18-karat gold was priced at ₹73,070 per 10 grams, according to Goodreturns.
In global markets, spot gold climbed 0.5% to $3,305.39 an ounce, hitting its highest since May 12. US gold futures rose 0.7% to $3,307.30 an ounce.
The rally was driven by a sharp decline in the US dollar, which hit its lowest level since May 7.
A weaker dollar makes gold cheaper for foreign investors, boosting demand.
“The general dollar index lost more than a full point in the last 24 hours as the Moody’s downgrade, plus skepticism about Trump’s tax bill continues to undermine the dollar,” said Edward Meir, analyst at Marex.
Moody’s downgraded the US credit rating from AAA to AA1. The move raised investor concerns about America’s fiscal health. Uncertainty grew further as US President Trump failed to rally full Republican support for his sweeping tax reform bill in Congress.
Investors are also nervous about escalating tensions in the Middle East.
Reports suggest Israel is preparing strikes on Iranian nuclear sites, potentially triggering a broader conflict.
Augmont’s daily bullion report said that gold could fall to $3,200 per ounce (₹92,000 per 10 grams) if it fails to hold above $3,265 (₹94,000). A break below $3,200 may trigger a deeper slide to $3,000 per ounce (~₹86,000 per 10 grams).
Despite near-term risks, analysts expect further upside.
“Over the medium to longer term, further upside in gold is favoured,” said Tim Waterer, Chief Market Analyst at KCM Trade. “However, positive trade-deal headlines could pose resistance around the $3,500 per ounce level.”
Gold typically performs well during times of political turmoil and low interest rates. The metal is seen as a hedge against both currency depreciation and inflation.
Outlook for Indian investors
For Indian investors, gold’s surge is a signal of ongoing global uncertainty. The metal remains a key safe-haven asset, especially with domestic and international markets facing volatility.
Augmont’s report set the Indian gold support and resistance levels at ₹92,000 and ₹97,500 per 10 grams, respectively. Investors should watch these levels closely for near-term cues.
-With Reuters inputs
