Gold price shines despite rate hike in US Fed meeting. Should you buy?
2 min read 27 Jul 2023, 10:02 AM ISTGold rate today is trading in $1,950 to $1,980 per ounce range in international market whereas on MCX, gold price today is in ₹59,000 to ₹59,800 per 10 gm range
PremiumGold rate today: Despite US Fed rate hike by 25 bps in the monetary policy meeting held on Wednesday, gold price today continue to ascend. In international market, yellow metal price went up over 0.30 per cent and hit $1,977 per ounce levels in earning morning deals in Asian stock market. Gold future contract for August 2023 expiry on Multi Commodity Exchange (MCX) opened higher at ₹59,610 per 10 gm, but soon profit booking triggered and it came down at ₹59,535 levels. However, it continue to remain in the green territory after around 45 minutes of commodity market opening in India.
Likewise, silver rate today opened high at ₹75,800 per kg level and went on to hit intraday high of ₹75,945 levels, within few minutes of commodity market opening. In international market, silver price is oscillating around $25.05 per ounce levels.
On why gold prices are oscillating today, Anuj Gupta, Vice President — Research at IIFL Securities said, “Gold prices have surged to five days high because the US Fed rate hike of 25 bps is in line with the market expectations. In fact, the market had already factored in about the 25 bps rate hike outcome from the US Fed meeting."
Gold price outlook
Speaking on gold price outlook, Colin Shah, MD at Kama Jewelry said, "A minor pullback in the currency rate of the US dollar has led to some optimism amongst gold buyers. In the domestic market, there seems to be a bit of a worry with regard to data projecting a fall this fiscal year in exportation by approximately 10 – 15% this fiscal year. However, with the onset of coming festivities, there seems to be optimism in the rise of purchases towards the end of H2 2023."
On outlook for gold price in near term, Sugandha Sachdeva, Executive Director & Chief Strategist at Acme Investment Advisors said, “The dollar index however declined following the comments from Fed chair with market participants hoping that the Fed is near the end of its rate hike campaign. A decline in greenback is supportive for gold prices where they have key support at ₹59,000 per 10 gm levels."
Important levels that you should know
The IIFL Securities expert said that gold price today is in $1,950 to $1,980 range. On breaching the upper hurdle, the yellow metal may shine up to $2,000 levels. On MCX, gold price is in ₹59,000 to ₹59,800 per 10 gm range. On breaching the upper hurdle, it may go up to ₹60,500 per 10 gm levels. He advised gold investors to maintain ‘buy on dips’ strategy in regard to the yellow metal as the trend for bullions is looking positive after US Fed meeting.
US Fed rate hike
The US Federal Reserve hiked interest rates by quarter of a percentage point on expected lines setting the benchmark overnight interest rate to 5.25–5.50% range and also indicated the possibility of another rate hike in September. The US Fed maintained that inflation is still high and further policy action would depend on the incoming data.
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.
