Source: Outlook business
Gold prices in India moved upwards in domestic futures markets, propelled by a weakening US dollar and increasing signs of an economic slowdown in the United States, thereby rekindling interest in gold as a safe-haven investment.
Market Snapshot
MCX Gold June Futures:
On Friday morning, it traded 0.46% higher at ₹92,768 per 10 grams.
Recently Achieved Summit:
On April 22, 2025, gold prices reached highest ever at ₹99,358 for every 10 gm.
Phase of correction:
Prices saw a correction of almost ₹7,000 from the peak under global trade optimism.
Key Drivers Behind Gold Price Movement
The Macro Factors
The US economy contracted by 0.3% (annualized) in Q1 2025—this was the first contraction in three years.
With ISM PMI slumping further to 48.7 last month from 49.0 in March, the manufacturing sector appears to be on a downward path.
The dollar index was down by 0.30%, making gold appealing globally.
Trade War and Policy Shifts
Easing tensions between the US and trading partners like China, India, Japan, and South Korea.
Trump said trade agreements could be reached with India, Japan, and South Korea and added that there is a “very good chance” of securing a deal with China.
A social media account with ties to the Chinese media said that the US approached China to ask to talk over Trump’s 145 percent tariffs.
As the peak period of anxiety with regards to the trade war went on in the past, there was a recovery of risk appetite by investors which led to profit booking from safe-haven assets as well as buying of equities.
Expert Opinions: Is This the Right Time to Buy?
“Wait for some more corrections. Buy MCX Gold around ₹90,000 level,” said Anuj Gupta, the head of commodities and currency products at HDFC Securities. “Our year-end target for gold remains ₹97,000-98,000,” Gupta said.
“We suggest buying gold around ₹92,200 with a stop loss of ₹91,780 for the target of ₹93,000,” said Manoj Kumar Jain of Prithvifinmart Commodity Research.
“Gold has support at $3,200-3,180, while resistance is at $3,250-3,280 per troy ounce, and silver has support at $31.84-31.40, while resistance is at $32.50-32.88 per troy ounce in today’s session. MCX Gold has support at ₹91,800-91,150 and resistance at ₹92,720-93,200, while silver has support at ₹94,000-93,350 and resistance at ₹95,200-96,000,” said Jain.
Investment Viewpoint
Gold ETFs are proposed as a fairly simple, cost-effective way of investing without much fuss in physical gold.
Ideal for investors contemplating security and liquidity with respect to gold.
Long-Term Outlook
Gold remains a valuable hedge due to:
- Central bank buying
- Geopolitical tensions
- Trade war uncertainties
- Potential stagflation risks in the US
These factors could support upward momentum in the medium to long term.
disclaimer
This article is for educational purposes alone. The opinions and recommendations made are solely those of the individual analysts and brokerage firms. Investors should seek the advice of certified financial advisers before making their investment decisions, as conditions in the markets may change rapidly and differ from one investor to another.
