New Delhi. Gold prices have broken all records this festive season. The interest of investors and customers in this yellow metal has increased significantly. Factors like possible changes in the US monetary policy and global tensions are taking the demand for gold to new heights. Due to festivals like Diwali and Dhanteras, there is a good demand for it in India too. At a time when prices are rising due to many reasons, how far can the price of gold go?

According to a CNBC TV18 report, gold prices in India today (16 October 2024) reached a record high. Gold rates saw a sharp jump due to demand from global markets and domestic festivals. Spot gold prices rose 0.3% to $2,667.97 (about ₹2,22,000 per ounce) in the international market. The price of 24-carat gold in India has reached ₹77,390 per 10 grams.

There are many reasons for the increase in demand for gold in international markets due to the rise in gold prices
. The most important reason is the fall in the US Treasury yield. The 10-year Treasury yield fell for the third consecutive day, making non-interest-bearing assets such as gold more attractive. This fall is based on the expectation that the US Federal Reserve will cut interest rates in the future.

According to ANZ commodity strategist Soni Kumari, “US monetary policy easing is a game changer for gold prices, as it increases investment demand.”

Apart from this, the ongoing tensions in the Middle East are also boosting the demand for gold. Renisha Chainani, Principal Researcher, at Augmont-Gold for All, said, "The trend of safe investment towards gold is increasing due to risk-free sentiment amid geopolitical threats."

Effect of Festivals in India
India is the world's second-largest consumer of gold. A huge surge in demand for gold is being seen in India during Diwali and Dhanteras. Colin Shah, MD of Kama Jewellery, said that prices are likely to increase further due to strong demand from jewelers and traders.

According to Shah, "We are expecting a 10-15% increase in demand this festive season, year-on-year." He said that consumer demand this year is much stronger than last year. He also predicted that as demand increases, gold could reach new highs.

Further prospects
Experts at the London Bullion Market Association's annual conference have predicted that gold prices could reach $2,941 (about ₹2,45,000 per ounce) in the next 12 months. Renisha Chainani said that if global trends remain favorable, the price of gold could go up to ₹78,500 per 10 grams.