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From this Diwali to the next, gold will shine at 53,000 rupees: Mofsl

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From this Diwali to the next, gold will shine at 53,000 rupees: Mofsl

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A number of domestic and international factors are expected to drive gold prices closer to the highs of Rs 52,000-53,000 over the next year, their previous peak, Motilal Oswal Financial Services (MOFSL) said in a report.

“We believe that gold has the potential to climb back up to $ 2,000 and could even have a new high life on the Comex. On the domestic front, we expect prices to rise to highs of Rs 52,000-53,000 over the next 12 months, “he added.

However, the current scenario could have some short-term setbacks, giving investors a better buying opportunity, he added.

“We have been optimistic and continue to maintain a positive bias for the price of gold over the next 12 months, and we expect the consolidation to stretch and could soon see some directional movement,” the report said.

Starting with internal trends, according to data from the World Gold Council, demand for the yellow metal for the quarter ending September 21 is 139 tonnes, up 47 percent from 94 tonnes the previous year. In India, with COVID-19 relatively under control, pent-up demand for jewelry has seen a 58 percent increase compared to the previous year during the July-September 2021 period.

After a 52 percent and 25 percent increase in gold prices in 2019 and 2020, respectively, gold prices moderated in 2021. Yellow metal prices ranged from Rs 47,000 to Rs 49,000. However, since then, demand for gold in India has rebounded sharply from 2020 lows.

After strict lockdowns, gold consumption declined about 49 percent in the first three quarters of this year. However, the upcoming holiday and wedding season is expected to boost demand for jewelry and help improve consumption figures, MOFSL said.

The general sentiment for the upward movement in prices is supported by the fact that the central bank is buying gold and the CFTC positions maintain their position in net long positions.

On the international front, despite the turmoil in global markets due to declining and rising inflation, metal prices have maintained their base thanks to lower interest rates and their general attractiveness as a safe haven against to inflation.

Other global uncertainties such as China’s Evergrande fiasco, the power shortage issue, the US-China trade battle, increasing Covid cases due to the Delta variant, and rising debt are affecting overall investment sentiment and working. in favor of gold prices.

(Edited by : Yashi gupta)

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From this Diwali to the next, gold will shine at 53,000 rupees: Mofsl

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